State of Emergency Should Target Building Costs, Not Rent
By Bashir Rabe Mani in Sokoto
The growing concern over the rising cost of housing in Nigeria is understandable and deserves urgent national attention. Millions of Nigerians are struggling to afford decent accommodation, and government must continue to seek lasting solutions.
However, the conversation must be anchored on the real cause of the problem rather than its visible consequence.
The housing crisis confronting Nigeria today is fundamentally a construction cost crisis. Rent is merely the end product of an economic chain that begins with the cost of acquiring land, purchasing building materials, paying for labour, accessing finance and providing infrastructure.
A landlord does not manufacture rent in isolation. He builds with cement, reinforcement rods, roofing sheets, electrical fittings, plumbing materials and other inputs whose prices have risen dramatically in recent years. Cement is now approaching N13,000 per bag in many parts of the country. The prices of steel, roofing materials and other essential components continue to climb almost daily. Labour costs have also doubled, with artisans who previously earned about N4,000 a day now charging as much as N8,000 or more.
These are the realities confronting every developer.
No responsible investor spends hundreds of millions of naira constructing houses only to recover a fraction of that investment. Like every other sector of the economy, real estate is driven by the cost of production. If the cost of building keeps rising, the cost of renting cannot remain stagnant.
For this reason, if there is any need for a state of emergency, it should be on the soaring cost of building materials and housing production, not on rent.
Government intervention should focus on reducing the cost of cement and other construction inputs, improving access to affordable long-term financing, strengthening local manufacturing, lowering energy and transportation costs, and creating policies that encourage developers to build more affordable homes.
That is how rents will fall naturally, through increased housing supply and lower construction costs, not through measures that merely attempt to regulate the final price while ignoring the factors that determine it.
It is equally important to acknowledge that the Federal Government has not been idle. Through ongoing affordable housing initiatives and the interventions of the Federal Mortgage Bank of Nigeria, significant investments are being made to expand access to housing across the country. In Lagos State, for example, billions of naira have been committed to new housing projects aimed at increasing the stock of affordable homes.
These efforts should be strengthened, expanded and supported; not overshadowed by proposals that risk discouraging private investment in housing development.
Developers are not adversaries of the Nigerian people. We are partners in solving the nation’s housing deficit. Every policy that makes it cheaper to build ultimately makes it cheaper to rent. Every policy that increases housing supply benefits tenants far more than policies that simply seek to suppress rental prices without addressing the economics behind them.
Nigeria needs practical solutions, not emotional reactions. Let us confront the root cause of the housing challenge by making it less expensive to build. That is the surest path to affordable housing for all Nigerians.
*Signed*
Alhaji Dr. Aliyu Wamakko Former President, Real Estate Developers Association of Nigeria (REDAN)
Chairman/CEO, Jedo Investment Company
