The Managing Director/Chief Executive Officer of the Nigeria Mortgage Refinance Company (NMRC), Mr. Kehinde Ogundimu has called on State Governments to adopt and pass the Model Mortgage Foreclosure Law (MMFL) to enhance access to affordable housing for their citizens.
Mr. Ogundimu stressed that the adoption and passage of the foreclosure law would mark an important foundational step for attracting required private sector investments in housing.
The NMRC MD/CEO made this call while speaking as a panelist at the Housing Development Advocacy Network (HDAN) Webinar on Post-COVID Affordable Housing Strategies, which held on Tuesday, 5th May.
He said “For States to become mortgage friendly and attract the needed investment in this sector it is vital that they pass this law in their states. Finance is critical to housing development and investors will only commit their funds in places where they are comfortable and certain that they are protected and can recoup their investments. That is why right from inception, NMRC has been at the forefront of making the finance environment conducive to both investors and mortgagors by leading efforts to develop the model mortgage foreclosure law.
We have made significant progress with state governments with respect to the adoption and passage of the Model Mortgage Foreclosure Law (MMFL). Kaduna and Lagos states have adopted and passed the MMFL. I am happy to note that several other states including Ekiti, Kwara, Nasarawa, Edo, and others have expressed enthusiastic desire to follow suit. I am positive that within the next three to four months depending on how the Covid-19 pandemic pans out, we would see a lot of state signing the MMFL. This is because most states have realized that one of the ways to empower their citizens and unlock the capital tied up in assets is through the passage of this law”.
The mortgage foreclosure law advocates the creation of state mortgage boards as one-stop-shop for facilitating mortgage administration, property registration, and title perfection processes in addition to the institutioning of non-judicial foreclosure process. The law will incentivize investment in states housing and mortgage sectors with multiplier effects such as greater home ownership, jobs, wealth creation as well as enhanced Internally Generated Revenues (IGR).
Speaking on evolving strategies to tackle the impact of Covid-19 on housing, Mr. Kehinde Ogundimu expressed optimism at the interventions announced by the government through the Central Bank of Nigeria (CBN) targeting the housing sector.
“This pandemic has caused a disruption that is broad, deep, and pervasive. It pervades the entire economic value chain. It started as a health crisis but quickly morphed into a credit, market, and liquidity crisis. The depth and duration of this crisis will determine how quickly the housing market will rebound. So, I am glad that the federal government and the monetary and fiscal authorities are beginning to come up with some form of intervention. But the breadth and scale of that intervention must be something that is unparalleled in Nigeria so that we don’t end up having a U-curve where we end up on that low trajectory where there is no growth for so long. We want this crisis to be a V-Shape recovery” He added further that to attract the required finance to drive homeownership there must be a secondary market. “Homeowners should be able to project that in two, three, four, or ten years’ time they can have an exit to sell their homes to move up or move down. For us to have this secondary market in Nigeria, it is important for states to pass this model mortgage and foreclosure law.
In the past year, we have made good progress in this light and seen some investments in some states. For instance, we have signed a tripartite agreement with Kaduna state, where we are doing an N3bn blended finance to create single-digit mortgages for citizens in the state. This is because Kaduna state has passed the mortgage foreclosure law, which makes it mortgage friendly so we are confident and comfortable to do business with them ”
The Webinar was organized by Housing Development Advocacy Network (HDAN) with focus on Family Homes Fund (FHF) Affordable Housing Initiatives and Post-COVID-19 strategy. It featured presentations by the FHF MD/CEO, Mr. Femi Adewole, Brig. Gen. Tunde Reis (Rtd), CEO First World Communities Ltd, and Mr. Olanrewaju, Director of Altair International UK. Other panelists included Mr. Enesi Makoju, Head Special Projects and HTO, FHF and Dr. Banke Abejirin, Head, Strategy, and Business Development, FHFL.
Mr Kehinde Ogundimu
M.D CEO, NMRC