Housing finance in urban Nigeria: a case study of Enugu

The provision of housing generally requires finance which is scarce and this often results in housing finance managers having to decide who receives what funds are available and where. A critical review of the existing literature on housing finance in Nigeria by the author suggested that housing finance institutions were deficient in number of institutions, size of loans granted and quality of services provided. Consequently, the research aimed at assessing the level of accessibility of the existing institutions to both landlords and tenants. A particular attempt was also made to identify practical difficulties encountered by small savers in having access to mortgages. In addition, the research examined the responses of such groups to the obstacles encountered and in particular, their use of unconventional means of finance based on informal credit unions such as isusu. The analysis was mainly based on the use of two social surveys made up of structured interview schedules with 477 landlords, 494 tenants and 50 members of daily small saver schemes. Unstructured interviews were also used to obtain information from managers of housing finance institutions and policy makers, and the author sat in as a non participant observer during isusu meetings. The research finds that the banks discriminate against low income households by denying them access to housing finance and by demanding tough loan requirements. One result is to favour the production of bungalows and to a lesser extent tenement blocks of flats. In addition, the research shows that informal credit unions and other small saver schemes make significant contributions to housing finance as many landlords use them in tandem with conventional methods to finance the construction of their houses through self-build. Moreover, the data shows that small savers are ready and willing to save, if the method of savings mobilization is simple and they are assured in return, of access to a large sum. The thesis concludes that in order to make housing finance available to many urbanites, a savings mobilization scheme which allows small saver groups to be linked to conventional institutions should be adopted.