How Rent-to-Own scheme is changing Lagos residents housing story

August 30, 2021, 5:45 pm Blog General Seen: 1627
How Rent-to-Own scheme is changing Lagos residents housing story
Gradually but steadily, Lagos State government is using its Rent-to-Own housing scheme to change the home-ownership story of the residents of the sprawling city whose population is estimated at 20 million.rnResidents housing story in Lagos can be summed up in just two words—inaccessibility and unaffordability. And for the tiny minority who can afford what is on offer, the cost is unimaginable.

These are the reasons over 60 percent of the population lives in rented accommodation, spending over 50 percent of their income on house rents. Those are the reasons too, the city is burdened with an estimated three million housing deficit that requires huge effort to close.

However, the state government says it is concerned about the residents housing challenges, hence the frequent interventions it makes with initiatives that are aimed to help the situation. The Lagos Home Ownership Mortgage Scheme LagosHOMS launched about eight years ago is one of such initiatives.

But this scheme did not achieve good mileage because of the numerous demands it made from subscribers. The most challenging was the demand for 30 percent equity contribution which many interested homeowners could not afford on account of poverty or low income or both.

This constraint, among other factors, gave birth to the Rent-to-Own housing scheme. The new initiative which was launched in the last quarter of 2016 with special focus on first time home buyers entered the housing market with 4,355 housing units it inherited from the mortgage scheme.

These houses came from 12 housing estates including Sir Michael Otedola Estate, Odoragunsen, Epe, Odo Onasa, Agbowa, Igbogbo Housing Estate, Ikorodu, Egan -Igando Housing estate, Alimosho, Lateef Jakande Gardens, Igando also in Alimosho. Other estates for the scheme are CHOIS City, Agbowa, Olaitan Mustapha Housing Estate, Ojokoro, Iponri Estate, Surulere, Sangotedo Estate, Eti-Osa and Ajara Estate, Badagry.

Over the years, the scheme which requires individual subscribers to pay only 5 percent of the cost of the housing unit as a commitment fee and the balance is spread over a period of 10 years with minimal interest, has progressed significantly.

The last one year of the Governor Babajide Sanwo-Olu administration in the state has not only strengthened the scheme, but has also given it greater impetus in terms of project delivery.

“In the last one year, this administration has strengthened its policy of delivering homes to Lagosians through a convenient mortgage system tagged Rent-to-Own,” Moruf Akinderu-Fatai, the state’s Commissioner for Housing, said at a ministerial briefing to mark Sanwo-Olu’s one year in office.

The implementation of the housing scheme is done by Lagos Mortgage Board headed by Bayowa Foresy as the general manager. The commissioner informed that beyond this primary responsibility of ensuring that homes built by the state are allocated and made accessible to first time home owners, the Board is also responsible for generating a conducive environment for accessible and affordable mortgage for the benefit of citizens of the state to acquire their own homes.

Besides the 600 beneficiaries recorded for the state’s mortgage schemes, Rent-to-Own scheme has also recorded 1,230 beneficiaries, giving over 9,150 Lagos residents that have benefitted from the two schemes.

According to the commissioner, this scheme has helped to reduce housing deficit in the state; promote mortgage culture; keep default rate to the barest minimum, and ensure that the existing schemes are in clean and habitable condition.rnApart from the Rent-to-Own scheme, Lagos is also delivering housing for other residents of the state some of whom already have their second or third feet on the property ladder. These include middle and upper class members of the society.

The Sanwo-Olu administration in the last 12 months completed and delivered some of these schemes. Among them were the Courtland Luxury Villas, Igbokushu in Lekki and Lekki Apartments located at Freedom Way Junction, Lekki Phase1.

A Joint Venture project between Lagos State Development and Property Corporation LSDPC and Messrs Le Grande Property Development Company, the Luxury Villas which sits on 28,321 square metres of land comprises 120 units of 4-bedroom maisonettes and a boy’s quarter.
“Apart from the home units added to the existing housing stock thereby reducing the housing deficit, the project is remarkable as it boasts amenities such as swimming pool, ample car park, community hall, 24-hour security, 5-aside football pitch, as well as water and sewage treatment plant,” the commissioner said.

On its part, Lekki Apartments which sits on 16,450 square metres of land comprises 124 units of 1,2&3-bedroom apartments. It is also a joint venture between Step Development Limited, Lagos State Ministry of Housing and LSDPC. The 124 units are configured into 36 units of 3-bedroom; 52 units of 2-bedroom, and 36 units of 1-bedroom apartments.

Altogether, the commissioner revealed, the state completed and delivered 1,576 new homes in its various housing schemes across the state in the past 12 months. This means that 1,576 families who are currently in the state’s housing market will be taken out of the market in the coming months.

Analysts note that, at an average of six persons per family, about 10,000 persons will be getting roofs over their heads, arguing that if this tempo is sustained in the next three years of Sanwo-Olu’s tenure, about 30,000 persons will have homes of their own.
The commissioner assured that more schemes would be completed before the first quarter of 2021 to yield an additional 2,284 homes. These projects, according to him, include LagosHOMS Sangotedo clusters with 1218 homes in Eti – Osa LGA, 660 homes at LagosHOMS Odo Onosa /Ayandelu in Agbowa Local Council Development Area, Egan Igando Scheme with 270 homes, and Lagoshoms LASU in Lagos State University main Campus with 36units.
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About the Author: Chuka Okoro
Chuka Okoro