Summary

Nigeria's housing reforms are aimed at the wrong problem, says HRM Oba Akintoye Felix Adeoye, President of the Real Estate Developers Association of Nigeria (REDAN). He made the case in a conversation with Faadil Yahaya of 48 Property. He supports the government's proposals: a national housing data set, escrow for off-plan deposits, licensing for developers and compulsory REDAN membership. But he argues that none of them fixes the real bottleneck. Mortgages reach under 5% of Nigerians, and developers can't build profitably with short-term loans at 25 to 30%.

His fix has three parts that feed each other. Fund the Federal Mortgage Bank properly, give developers single-digit construction finance and give buyers access to mortgages. He also wants title registration made cheap and fast, because an untitled property is a "dead asset" no bank will lend against. He goes as far as urging states to issue free Certificates of Occupancy and earn their money from land charges instead. Lagos in 1979 is his proof that government-led housing can work, unde the Jakande government. He calls housing better social policy than cash handouts, since a home creates jobs and gives people an address. He also predicts that AI may make young people care less about owning anything at all.

The Real Bottleneck in Nigerian Housing

There is a figure that explains most of what is wrong with housing in Nigeria, and HRM Oba Akintoye Felix Adeoye delivers it almost in passing.

"So how many people have access to mortgage? The entire mortgage in Nigeria now is not up to 5%."

He is the President and Chairman of Council of the Real Estate Developers Association of Nigeria, REDAN, the umbrella body for the country's private developers. He has been in the sector for more than thirty years. Over the better part of an hour with Faadil Yahaya, Co-Founder of 48 Property, he walks patiently through the new housing proposals everyone is talking about: escrow for off-plan money, licensing for developers, a national housing data set. He supports most of it. And then, repeatedly, he returns to the point that none of it addresses the thing that is actually stopping Nigerians from owning homes.

Paid in land, not fees

Before any of the policy, there is the story of how he got into property, and it tells you a great deal about how he thinks.

"My background is law. I'm a lawyer," he says. "When I started practice, I was fortunate to have clients who were landowners. And I remember very well that I decided not to collect money, but to collect land for my reward, for my remuneration."

The reasoning was part economics, part psychology. A young lawyer has little leverage over fees. "I was quite a young lawyer. So how much do you want to pay a very young lawyer?" His clients, meanwhile, had often come by their land through inheritance rather than work. Handing over a few plots felt cheaper to them than writing a cheque. "It's easier for them to say, OK, we give you three plots, we give you six plots, than to say, we pay you a million."

When those clients sold land, he took his commission in land too. When he helped rural owners survey large holdings they had never properly mapped, he took a plot per acre. "If I help you to carry out the survey of 100 acres of land, I will collect one plot on every one acre. And that translates to 100 plots." Some clients held 200 acres. Plot by plot, a lawyer's fees became a landholding.

"Gradually, I realised that that is the space that I just have to be."

Asked whether landowners are still that generous, he says the opportunity survives, just not where he found it. "Such arrangements will still be available, but probably not in the market where I started. I was in Lagos." Development has closed that door in the city. "Outside the urban metropolis, you can still get such opportunity."

The underlying lesson is one he returns to at the very end of the interview. "I like trading, I like doing business, and I like work," he says. "It's all about how smart you are to take advantage of the opportunities that come in front of you."

What REDAN actually does

Many people outside the industry, Faadil points out, assume REDAN is a government agency. It is not, although government did bring it into being.

"The association was actually established by the government. It was a creation of the government, but not government running it." The problem it solved was practical: a ministry that wanted to talk to developers had no way to reach hundreds of individual firms. "Instead of calling one developer after another," the Oba explains, government asked developers to form a single association it could address. When the ministry wants information, a meeting or a conference, "we write the association. Then the association will communicate to their members."

Its mandate, he says, is simple. "The mandate is advocacy. We advocate for our members. We also train members. So it's also a club for mentoring." Younger developers get access to experienced ones. Members collaborate. "Some people have land, and some people have money. So you bring money, I bring my land, then we go into partnership." Some have gone as far as merging their businesses.

The association has also been his own route outward. "I remember my first trip to the US was on the platform of this association." It organises programmes at home and abroad, and deliberately arranges for young developers to visit major projects and hear senior developers explain how they started. "Some developers were so small when they came in, but this association has pulled them into the business in a better way, in a bigger way."

And it fights battles individual developers cannot. "There are some fights that you cannot fight directly, because maybe you are fighting with government, but the association can take it up," he says. It does so in the association's name rather than the member's.

Joining is straightforward: a membership form that works, in his words, like know-your-customer checks on "the people behind your business". He puts the costs at around ₦50,000 and ₦200,000 by his own estimate, and calls them "very cheap".

The proposed regulations on the table

The Federal Ministry of Housing and Urban Development has been circulating a new housing and built environment policy, and the Oba is careful about its status before saying anything else. "The policy is a new one, not yet a policy. It's like a proposal."

It has four parts.

1. Data

Nigeria does not reliably know how many homes exist or how large the shortfall is. "Data collection, which is very important. They want to be collecting data on the number of houses that were built and the shortage, the gap." REDAN, the Central Bank, the Federal Mortgage Bank and other agencies are involved. The significant detail is where the data will sit: not with the ministry, but with a special purpose vehicle created for the job. That structure, he says, has now been approved. "It's not about the ministry."

2. Escrow

This is the change that will matter most to anyone who has ever bought a home off-plan. At present, developers collect deposits from buyers and spend them. The proposal is that "when developers engage in off-plan sales and they are collecting money from subscribers, they should not spend this money. The money should be put into escrow," to be released once approvals are in place and building starts.

He is relaxed about it, and pushes back on the idea that it is a punishment. "The thing about the escrow is this. It's about discipline. It's about trust. Not that you cannot access the money." How it will work is still open. "How are we going to do it? I don't know. But it's being done in other climes, Dubai particularly. So probably we are going to borrow the Dubai model."

3. Licensing developers

He supports registration and regulation "because of some atrocities in the sector," though he adds that these are not peculiar to Nigeria. But he draws a line he returns to several times. REDAN should not be the regulator, because "the licence in itself does not totally regulate."

What REDAN offers instead is presence. "We are the ones on the field. We are the ones that understand the game." The association's role is "to professionalise, to bring ethics, to bring standards. There must be a body that is introducing continued education for the developers."

4. Compulsory membership

"REDAN was created 24 years ago," he says, and membership has always been voluntary. That would change. "By the time this regulation comes in, the government will now make it compulsory" to belong, and the association's certificate becomes the gate to practising. "If you don't have access to our certificate, you will not be able to register. And if you are not able to register, you will not be able to practise."

His model is the Nigerian Bar Association: being called to the bar is a single event, but practising requires a certificate that can be withheld for misconduct.

Where developers stand

Are REDAN's members actually open to all this? Conditionally, he says. "We are open because we want the best for the sector."

The condition is motive. If licensing becomes a revenue exercise, a matter of "come and collect a licence and pay something very exorbitant", he doubts members will support it. "I'm not saying that it's going to be free." But if the aim is to professionalise, educate and train, "then that would be fantastic."

His broader posture towards government is notably unguarded. "We are not saying, government, don't regulate us. Don't regulate how we collect money. Go ahead and regulate." If a policy works, "it works for the good of all of us. If it doesn't work, then we go back to the drawing board."

The bottleneck nobody is proposing to fix

Faadil raises Dubai again. There, escrow sits alongside cheap construction credit, so projects don't stall. In Nigeria, developers lean on buyers' deposits precisely because bank borrowing is so expensive. Take the deposits away without replacing the money, and what happens?

The Oba's answer is the heart of the interview. "Real estate business is heavy cash, heavy money business. And the business is not well developed in Nigeria. We don't build up to 100,000 units in Nigeria." Cut developers off from deposits without an alternative, and "they are going to be having fewer houses."

He contrasts this with how housing works elsewhere. "Many of us, we live in rented apartments. But if you live in the UK today, or in the US, almost all of us there, because we have a job, will be living in our own home. We get a mortgage." In Nigeria, the entire mortgage market is "not up to 5%."

Faadil describes the same wall from 48 Property's side: years of trying to push buyers through mortgage applications, with very few able to proceed. Even someone earning a million Naira a month, he says, struggles to qualify unless they are buying a ₦14 million to ₦15 million home in one of the city's satellite towns.

The Oba explains why. "The cost of funds in Nigeria is very high. Mortgage is a long-term business. Available funds in Nigeria are short-term funds, not long-term funds." The only institution lending at single-digit rates is the Federal Mortgage Bank of Nigeria, and its reach is tiny: it "creates probably 1,000 to 5,000 mortgages every year." A blended-finance window under the Ministry of Finance Incorporated lends at higher rates, but not single digits.

And even if more mortgages existed, there would be little to spend them on. "The major problem is we don't even have houses to finance." Developers cannot build with short-term commercial money: "You cannot finance construction with short-term funds at 30%, 25%, and make profits. It's so tight."

A loop, not a patch

"There are other big issues, more than escrow, more than developers' registration," he says. That does not make the reforms pointless: "whichever one they bring up, let us also attend to that, because it's still part of the problem." But they are not the main event.

His prescription is a loop. "The Federal Mortgage Bank should be capitalised, should be well funded. Developers should also have access to construction finance, single digits. Then the buyers, they must have access to mortgage. Because when I borrow money to build, my off-takers have access to mortgage to buy. Then I can build more. Supply gets better. Demand improves. And that is the way to go."

Your property is a dead asset

The second structural problem is title, and here he is at his most exasperated.

Faadil notes that many developers, particularly in Abuja, never perfect the titles on their projects, which puts them beyond the reach of mortgage lenders. The Oba agrees it is critical. "It's very important that you have legal title for your construction, for your projects," he says. But the system itself punishes anyone who tries.

"The cost of perfecting documents is too high. Even from the lawyer who is collecting 10%, to the agent that is collecting 10%." Abroad, he says, those costs run to a percent or two. And the delay dwarfs the cost. "When you buy a property in the UK today, you can register that property within two or three days. Everything is concluded." In Nigeria, it can take five years.

The consequence is not just paperwork. It is capital that cannot move. "It makes your transaction expensive, and it makes your property a dead asset in your hands, because you are not having the legal title." No bank will lend against it: "no bank will give you a mortgage on a title that is equitable, that is not perfect."

He resists the idea of ranking these problems against each other. "All the issues are connected, and all the issues are important."

A trader at heart

Asked what he would be doing if he were not in real estate, he does not hesitate. "I would be a trader. I like trading. I'll be selling commodities."

Even then, he wouldn't settle for the obvious version. "Not a cocoa farmer selling my own cocoa. Probably I would be buying all the cocoa within my neighbourhood and be the one taking the product to the overall buyer." He laughs at himself. "So I'm restless. I like activity."

"It's not rocket science"

What is wrong with the sector after all his years in it? "There are so many things wrong with the sector. The sector is not growing." He points to demography as evidence of how much more is possible: "look at our population, 250 million people, and we have a very young population." "And it's not rocket science. It's just for the government to be intentional."

His plan starts with an asset government already holds. "Government is big. Government is huge." If it sold the houses and land it owns but does not use, and put the proceeds into the Federal Mortgage Bank, that money could fund new homes with a subsidy built in. "The land is going to be free," he says, and perfecting the title would cost buyers nothing either. And government would buy building materials in bulk, negotiating a lower price with manufacturers in exchange for guaranteed volume.

It sounds ambitious until he points to the precedent. "They did it in Lagos, 1979. So it's not as if it hasn't been done before. At least somebody did it." A single state governor, within four years, delivered more housing than the entire country now manages in the same period. "Not in Ghana, not in America. A governor."

What made it work, he argues, was its purpose. "That model was not looking at profits for the government. It was looking after the welfare of the citizens."

Houses, not handouts

From there he makes his most provocative argument: that housing is better social policy than cash transfers.

"If you are going to villages and you say that you are giving them cash, it doesn't help anybody. Because you are providing food for a day, for two days." A home is different, he says, and not only for the family living in it. "Give them something like a house. I tell you, kidnapping will reduce. Because that gives them an address that you can trace them to."

His reasoning is about accountability. "A man that has an address is more careful than a man that doesn't have an address. If somebody sleeps under the bridge, he doesn't have any address, his propensity to commit crime is high."

Housing, he adds, is also a jobs engine on a scale few other sectors match. "When you build a three-bedroom bungalow, you employ about ten people. Just imagine what you are doing with houses in thousands. Everybody will be busy." He notes that advanced economies reach for exactly this lever in a downturn: when they want to revive the economy, "they go to housing construction, because of this heavy labour-consuming sector."

"We just hope that one day we'll get it correct."

In ten years, you may not want to own anything

Faadil, himself a young Nigerian, asks the question many of his peers are asking: with prices where they are in Abuja and Lagos, will young people ever own homes?

The answer is not the reassurance you might expect from the head of a developers' association.

"Artificial intelligence is a revolution," he says. "It can revolutionise how we do business. It can change the dimension. And I'm not very sure that in ten years' time we'll be interested in owning a house again, because the way we even own property will change over time."

You will not buy homes scattered across the world, he suggests; you will check in. "When you get to Abuja, just from your phone, you check into a room. When you get to New York City, just from your phone, you book and check into the available room." Cars go the same way once they drive themselves. "When you even buy a car, people will say, what is wrong with you? What do I do with cars? You don't need it."

"So you are not going to own anything. That is the future. And that is the truth of the future."

Why states should give titles away

For his final answer, on where the market goes over the next decade, he is bullish. "You cannot put a lid on it that it will not grow. It will definitely grow." Capital, he says, is abundant and looking for problems to solve: "Money today does not have bandwidth."

And he predicts that state governments will eventually abandon the way they handle titles, because it simply does not pay. "It is better for my government to issue all of us free C of O on our property."

A state that gives titles away, he argues, gains something worth far more than the fees: knowledge of every property within its borders, and the ability to levy land charges and tenement rates against it. "You become richer doing that" than waiting for owners to come forward and pay something like ₦500,000 for a C of O. Most never do.

"When they have that title in their hands, you now have the data. And data is the new oil, is the new gold." A governor could go to the market and say, in his illustration, "in my state, we have over 2 million properties with title." Those titles "have removed those properties from dead assets to living assets." Banks can lend, "people can use the title as collateral, so the economy of the state is going to improve. Is that scientific? It's not. It's straightforward."

Some states, he expects, will go further still, and "legislate that it is an offence for you not to come and collect your title."

His model is electricity. Prepaid meters once cost ₦200,000 to ₦300,000, and many people simply connected without paying. Once meters were installed free, the utility knew exactly which houses it served, and it began collecting for the power, with the meter's cost folded quietly into years of bills. He compares it to buying a phone in the UK on a two-year plan: "No deposit. Take it, no interest. But every month, pay."

"Make access very easy," he says. "When you make access very easy, then you start to benefit." States that complain their internally generated revenue is low, he argues, are simply doing what everyone else does. "You cannot be doing what everybody is doing. You want to make money, you must do the reverse thing. You must do something that is not common."

Back to the beginning

Which brings him, unprompted, back to where the conversation started: a young lawyer turning down fees.

"How many people were collecting land when I was collecting that? Very few. I was even probably the only person among my friends collecting land instead of fees." Clients with money would hire senior lawyers; land, by contrast, cost them little to give. "Me, I know how to translate that land to money."

"You have to do things in a way that is not the usual."

It is a fitting close to an interview that, for all its detail on escrow accounts and licensing regimes, keeps making the same case: the reforms Nigeria is debating are worth doing, but the country will only build at scale when money, title and ambition finally move together.

Watch the full conversation between HRM Oba Akintoye Felix Adeoye, President and Chairman of Council of the Real Estate Developers Association of Nigeria, and Faadil Yahaya, Co-Founder of 48 Property. A Giddaa x 48 Property production.