Yinka Kolawole
8 November 2009
Bureaucratic bottlenecks, dearth of basic infrastructures and costly land administration constitute some of the major challenges to effective mortgage financing in Nigeria.
Managing Director, Federal Mortgage Bank of Nigeria (FMBN), Mr. Ahmed Abdulsalam, recently remarked that in addition to tackling these challenges, recapitalization and consolidation of the primary mortgage institutions (PMIs) is also crucially needed in order to improve their capacity to generate the magnitude of quality mortgage loans necessary for the takeoff of the secondary mortgage market.
"The dearth of basic infrastructure, which adds up to 30 percent of housing development costs as well as the high cost of building materials is a major challenge that need to be addressed. Other problems include bureaucratic and costly land administration by state government registries, high cost and procedural difficulty to foreclose on defaulting mortgages," he stated.
It would be recalled that a recent World Bank Doing Business 2010 Report ranks Nigeria last among the 46 countries surveyed in Africa on the ease of registering property, and 178 out of 183 countries in the world, using criteria such as procedures, time and cost involved in transferring commercial real estate.
On the average, the report noted that it requires 13 procedures, takes 82 days, and costs 20.9 per cent of property value to register a property in Nigeria.
The report noted that it only takes 5 procedural steps to register a property in Ghana, 4 in Benin, 5 in Cameroun, 8 in Kenya, as against 13 in Nigeria. Also, whereas property registration costs 20.9 per cent of property value in Nigeria, it only costs 1.1 per cent in Ghana, 4.2 per cent in Kenya and 11.8 per cent in Benin. Registering property, according to the report, takes an average of 34 days to complete in Ghana, 23 days in Namibia and 26 days in Mauritius.
The average sub-Saharan data is 6.7 procedural steps, 80.7 days and a cost of 9.9 per cent of property value.
According to the World Bank report, the procedures involved in registering property in Nigeria include: Conduct a Property title search at the Land Registry; Obtain Application Land Form 1C; Obtain Certified True Copy (CTC) of title document; Obtain a Survey plan; and Execution of Deed of Assignment/Conveyance and Land Form 1C.
Others are: Payment of the Charting Fee, Administrative Fees, Endorsement fee at a designated bank; Submit application for Governor's Consent to the Assignment; Obtain notice of Stamp duty , Registration fees, Consent fees, Neighbourhood improvement charge at the Land Registry; Payment of Stamp duty , Registration fees, Consent fees, Neighbourhood improvement charge at a commercial bank; and Submit the Receipts of the Registration fees, Consent fees, Neighbourhood improvement charge, Stamp duty. In addition, one has to: Obtain file from the Land Services Department; Stamping of the deed of assignment; and Registration of Certificate of Occupancy or Deed and Title conferred
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