Transforming Lives Through Sustainable Housing Development in Nigeria
Housing plays a vital role in economic development, stability, and community wellbeing in Nigeria. The government's focus on inclusive and efficient housing policies, collaboration with stakeholders, and investment in housing finance mechanisms are key to driving social and economic progress through affordable and sustainable housing solutions.
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CHANGING LIVES: FAMILY HOMES FUNDS STORY IN NIGERIA June 2024
Housing is a bedrock for economic development Adequate and affordable housing contributes to economic stability, growth, and the overall wellbeing of communities. Key indicators include: Economic stability and growth (job creation, skill acquisition and industry growth) Economic mobility and productivity Poverty reduction and social inclusion Community development Human capital development Economic diversification and resilience Environmental sustainability Government plays a critical role in creating a sustainable inclusive and efficient housing sector that meet the needs of its citizens especially the low- and middle-income groups.
Government plays a critical role in creating a sustainable inclusive and efficient housing sector that meet the needs of its citizens especially the low- and middle- income groups. Housing policy thrust of the Nigerian Government Active participation of the three tiers of Government and other stakeholders, in housing delivery; Enabling environment for private sector investment and the injection of offshore funds for housing development; Harmonization and standardization of land administration processes nationwide; Collaboration and partnership with the financial sector operators and regulators to facilitate linkage to the capital market for long term affordable and sustainable liquidity for housing development. Promotion of the use of locally made building materials and appropriate production technologies by government taking the lead Job creation through mass housing delivery as a catalyst for rapid and sustained social economic development Social and Cooperative Housing, as social responsibilities of Government for ensuring poverty reduction
Collaboration and partnership with the financial sector operators and regulators to facilitate linkage to the capital market for long term affordable and sustainable liquidity for housing development.
Housing finance is a critical factor in the housing value chain It is the engine that drives the housing sector and generally refers to the money required for the development of housing units, provision of housing infrastructure and purchase or acquisition of housing units. Accessibility to large pools of long-term funds at cheap rates is imperative for mass housing development. The existence of a well-structured housing finance mechanism is imperative and addresses the issues of affordability for households, accessibility and viability for financial institutions and developers. Government provides the funding requirement foundation to attract domestic and international resources for the expansion of the housing finance sector for affordable housing.
The existence of a well-structured housing finance mechanism is imperative and addresses the issues of affordability for households, accessibility and viability for financial institutions and developers.
The FHFL Story 2017 Incorporated 2018 Commenced operations Affordable Housing Fund (AHF) Help To Own Fund (HTO) Aimed at financing the construction of affordable housing viz: Construction Finance Staff Housing Sites & Services Legacy Estates Enables households purchase a new home with a 10% deposit instead of the traditional 20-30% viz: Mission established to provide affordable homes and create jobs through innovative solutions, leveraging our skilled workforce, strategic partnerships and technology FHFL Product Offerings Mortgages Vision Rental Housing Fund (RHF) Land & Infrastructure Fund We aim to be the leading housing intervention institution in Africa. Enables low-income household move into a new home with one month's rent and deposit viz: Short-term construction finance facility for real estate developers, offering a 10% interest rate viz: 49% 51% Rental Housing Student Housing Land Banking Off-Site Infrastructure 49% 51%
FHFL has financed 16,000+ homes and created 85,000+ jobs across 15 states in Nigeria Our Impact: 16,000+ 16,000+ 53 53 85,000 Jobs (Direct and Indirect) Created 21,000 Astrong pipeline of homes progressing at different levels Homes Financed Project Sites in 15 states Balance Sheet 155bn FHFL current size Loan Portfolio N N155bn N N75.4 75.4bn bn Profit 4.28bn All loans are 98% performing N N4.28bn Rated by Agusto & Co The company achieved N4.28bn PBT in 2023 BBB+ GCR Rating $ $60m 60m AfDB Help -to-Own (HTO) product facility.
The foundation of FHFL achievements is based on our role as fund aggregators, targeting all low-mid income segment of the housing economic pyramid Market Context: Investors/Creditors Development Finance Institutions (DFI), wholesaledebt State Governments Infrastructure financing, Construction/Developer financing FHFL activates the finance value chain to deliver large scale housing programmes while expanding affordability through different funding and housing financial instruments Housing Developers Construction/Developer financing, Private sector financing Capital Market Private equity, pension funds, insurance companies Individuals End-user financing (Mortgage) Government Grants Housing Delivery Funding Financing 9
FHFL activates the housing finance value chain to deliver large scale housing programmes and expand affordability through its funding structure Market Context: FHFL is positioned to leverage financial instruments that would deliver large scale housing programmes through the implementation of our multi- investor/multi- donor trust fund Housing Financing Chain Housing Delivery Chain Source: NESG Research
As a fund aggregator, FHFL integrates all stakeholders in the housing finance value chain to deliver affordable housing Market Context: Engages the finance value chain by leveraging different funding and housing financial instruments that expand affordability Critical stimulation of construction and house rental value chains Leverages broader pool of funds (pension funds, private and government equity, insurance and development finance) to accelerate housing delivery value chains across the country Expands financial instruments deployment to deepen the market Deploys an Intervention Fund with a sustainable mode to scale the aggregated demand of N9.2tn Construction and Rental Markets
In addition to our housing finance value chain responsibility, FHFL has taken actionable steps towards sustainability in a rapidly changing world Our Impact: Employee Participation Promoting Sustainability Community Development Our approach Our employees spearhead transformative change, fostering a sense of unity and pride within our organization and the communities we serve. We focus on adding value to the communities where we operate, enhancing their lives and leaving them better equipped to succeed themselves. FHFL s activities ensure alignment to the sustainability of the environment in which we serve Our approach involves introduction of ESG requirement as an eligibility criteria for financing Developers and the adoption of alternative building technologies FHFL is committed to building inclusive communities through institutionalizing ESG frameworks and policies in our multi-faceted funding structure.
In the long term, FHFL will strengthen the Nigerian affordable housing market by delivering large scale housing Our Future: IMPACTAND CONTINUAL INNOVATION PHASE BUILDUPTO TRANSFORMATION PHASE BREAKTHROUGH TO MARKET DOMINANCE PHASE FHFLSTRATEGIC THEMES In the short-term, raise the profile of FHFL to be attractive to internal housing finance, glocalize the business model, transform the meaning of social housing finance and reduce the emphasis on lower poverty unbankable segments except with specified finance that matches social housing and deepen the affordable housing supply; 2028 - 2030 In the medium term, re- establish FHFL's presence in the affordable housing market through the creation of new market boundaries by extending the FHFL to include all segments of the affordable market to include lower and upper middle class, thus, putting 500,000 families in homes and creating 1,000,000 direct and indirect jobs in the process. Scale to 1M Housing Units by 2030 and in the longer term, exponentially increase the number of housing units built and families sheltered to dominate the over 9.226 Trillion Naira Nigerian Affordable Housing Market through strengthened local development and construction capacity, building intermediate input capacity feeding into the housing sector, stimulating effective household demand for housing; improving program and project implementation and sector monitoring; and improving the housing and real estate investment climate in Nigeria and Africa. 2025 2024 FHFLSTRATEGIC HORIZONS SHORT-TERM MEDIUM-TERM LONG-TERM
Sectorial challenges The continent is faced with these challenges in the housing finance value chain: Fund mismatch (short term funds for long term lending). Mobilizing resources effectively for no-income, low income, and medium income housing. Absence of a strong secondary mortgage market. Lack of uniform mortgage under writing standards. National housing database.
FHFL has financed 16,000+ homes and created 85,000+ jobs across 15 states of the Federation Our Impact: Darmanawa, Kano State Asaba Delta State New Makun City, Ogun State Millenium City Chikun, Kaduna Yobe State Luvu Madaki Nassarawa State Borno State Ogun State Niger State Akwa Ibom Malkohi, Adaamawa State Kano Teacher s Reserved Area 15
housing is a fundamental human right and a key driver of social and economic development that addressing the housing challenges requires collaborative efforts among stakeholders, including government agencies, financial institutions, private sector partners, and communities themselves 16
THANK YOU THANK YOU 17
