A primary mortgage operator says themortgage instituition is virtually non-existent in Nigeria due to lack of sufficient funds to meet the huge demand.

Anthony Owuye, the Managing Director, Personal Trust Savings and Loans Limited, says what can truly be called a Mortgage Financing line in Nigeria today in terms of tenor and pricing, is the line from the Federal Mortgage Bank of Nigeria (FMBN), which is the National Housing Fund Loan.

According to him, even this has its own problems and is not easily available while the conditions are stringent and in sympathy with the FMBN itself, the fund available to the bank is far short of the total demand on it.

"So, the demand far outstrips supply, hence it is unable to meet the demand on it. It makes the approval for loan application very slow. Mortgage as an instrument for accessing home ownership is gradually becoming a strong instrument. "The culture of the people before now, wrong or right, is that you work all your life and save and with all your terminal benefits and gratuity, you are able to own a home.

"Then, you now have the other group, of course, that also through the culture of the people, wrong or right, believe that they must steal, corner some money before they can own a home. It is now becoming that neither of the two routes is able to guarantee you a home. People are now beginning to appreciate mortgage. But within our financial system, mortgage itself has not been well established, " Mr. Owuye concluded.

He added "Therefore, what you have today that is evolving is that because the money is not there, the long-term money needed to fund mortgage is really not in the system as at today. So, it means therefore, what is available is very limited. The World Bank actually described what is available right now from FMBN as 'an unsustainable lottery' in the sense that it is like a lottery, the number of people who need this fund far outstrips what is available.

"So, it is a matter of throwing the coin to see who wins and who loses. Is mortgage really available today? I would say no. It is just coming on slowly. It is a function of the economy. As at today, what you have from our commercial banks are not truly mortgage financing. In developed economies, it is well structured and organised. The system is providing money for the real estate market in the developed economy."