Nigeria Launches N1 Trillion Housing Fund to Tackle 28 Million Homes Deficit

Abuja, Nigeria – The Federal Government has unveiled plans to establish a N1 trillion ($654 million) housing fund aimed at providing affordable mortgages to Nigerians, as part of efforts to bridge the country’s staggering 28 million homes deficit.

Finance Minister Wale Edun disclosed this during a media briefing on Tuesday, revealing that the first phase of the initiative includes a 40-year concessional loan from the World Bank’s International Development Association (IDA) at a 1% interest rate. The government has also secured matching contributions from local pension funds, banks, and insurance firms, raising an initial N250 billion.

Making Homeownership Affordable

Edun stated that the fund will enable Nigerians to access mortgages at single-digit and low double-digit interest rates, breaking the current barriers to homeownership.

“This fund will provide structured financing solutions, making housing more accessible to ordinary Nigerians,” he said. “We are addressing a critical gap in the market, where mortgages currently account for less than 1% of GDP.”

Nigeria’s Housing Crisis

Africa’s most populous nation faces a severe housing shortage, with most real estate transactions conducted in cash—a system that has enabled corruption and exploitation by fraudulent operators. The Federal Mortgage Bank of Nigeria estimates that the country needs at least 28 million additional homes to meet demand.

The new fund is expected to stimulate a construction boom by providing developers with guaranteed off-takers, Edun noted.

Road Infrastructure Projects in the Pipeline

In a related development, the Finance Minister announced that the government is finalizing contracts with private investors to construct and manage 40 major roads spanning 5,000 kilometers (3,100 miles).

The Africa Finance Corporation (AFC), a Lagos-based multilateral financial institution, is among the key investors in the road infrastructure initiative.

Successful Pilot Fundraising

Last week, the Ministry of Finance Incorporated Real Estate Investment Fund (MREIF) successfully closed its N250 billion pilot fundraising, marking a major milestone in bridging Nigeria’s housing finance gap.

The N100 billion Series 2 issuance was fully subscribed, reflecting strong demand from institutional investors and affirming market confidence in the fund’s long-term potential. This follows MOFI’s initial N150 billion investment in Series 1, with the latest round attracting robust private sector participation.

“The successful close of this pilot phase marks the beginning of a long-overdue transformation in Nigeria’s housing sector,” Edun said in a statement. “The full subscription of Series 2 demonstrates pent-up demand for structured housing finance solutions and investor confidence in MREIF as a sustainable investment vehicle.”

Looking Ahead

The N1 trillion housing fund and road infrastructure projects are part of the Tinubu administration’s broader economic reforms, aimed at boosting job creation, improving living standards, and stimulating economic growth.

With the first phase already underway, analysts say the initiative could revolutionize Nigeria’s real estate sector—if implementation is transparent and efficient.

Next Steps:

• The housing fund is expected to roll out mortgage access in Q4 2024.
• Road construction contracts will be finalized in the coming months.
• The government plans additional fundraising rounds to expand the housing initiative.

Stay tuned for further updates as Nigeria takes bold steps toward solving its housing and infrastructure challenges.

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Source: Nairametrics