03 May HOW TO MOVE IN AND PAY LATER FOR HOUSES IN LAGOS STATE (PROS & CONS)
A lot of Nigerians dream of a scheme where they can move in and pay later for houses, simply because they want to avoid paying high rent. House rent in Lagos keep soaring, with flat apartments in the medium highbrow of Surulere, Ikeja, Chevron currently at N1.5m to N2m per annum.
If home buyers are allowed to move in and be paying later for a house in Lagos, buyers can easily convert their rent into an ownership mortgage. However, despite the dire need for a viable and accessible mortgage or rent to own scheme in Lagos, it’s still very hard to qualify and be eligible. Yet, it will still help for you to educate yourself on the available schemes you can take to buy a house in Lagos and pay later.
Nigerians abroad are very familiar with house mortgages, lot of them are already paying for one or two mortgage houses in UK or USA. But, when they try to access a similar mortgage financing to buy a house in Lagos, they realize it’s quite different entirely.
Mortgage and rent to own have a very low awareness in Lagos, most people are not aware they exist. Moreso, the people that have luckily been able to apply and buy a house in Lagos via mortgage remains very low, so there are no testimonials.
Major commercial banks in Lagos have a mortgage branch, GT bank, First Bank, Access Bank, Union bank, UBA, Standard Charterted etc. However, the mortgage arm is just there, doing too little, with no impact. Even most of these bank’s customers cannot get mortgages from the bank they have huge savings with.
Since most of these banks in Lagos overlook their mortgage roles, no adverts and no competitive products. Therefore, mortgage financing in Lagos housing market for both developers and offtakers is very minimal. Both developers and offtakers avoid the mortgage options because instead of offering financial help it creates a financial dilemma.
There are a couple of mortgage and rent to own schemes in Lagos which you can use to buy a house, move in and pay later while living there. Each of these schemes present their pros and cons, but they are active although accessing these schemes isn’t stressfree.
NHF (National Housing Fund) Mortgage
NHF mortgage is more active and far more popular in Abuja than Lagos, there are more NHF participants in Abuja than in Lagos too. The National Housing Fund (NHF) mortgage is disbursed by Federal Mortgage Bank of Nigeria (FMBN), simply NHF is a federal government scheme.
NHF was setup initially for civil servants all over Nigeria, although now NHF is open to private workers too. It provides a simple contribution scheme where workers can pay a little percentage of their salary monthly. This contribution can later be used to access a mortgage loan which a NHF member can use to build or buy a house.
Although, NHF seem to work pretty well in some Northern part of Nigeria, but in Lagos, NHF has very little impact. Several workers that have contributed for years have waited long trying to apply for mortgage financing. In addition, it’s even impossible to use the NHF fund to solely buy a house in Lagos, because max cap of NHF disbursement is N15m.
Since the average cost of houses in Lagos is above N15m, what will those who have contributed for years do?. Workers who want to buy a house in Yaba, Surulere, Somolu, Ajah etc later realize it’s a futile effort. Because they will likely have to take one or two other loans plus NHF to be able to afford those houses.
For the past 5years in Lagos, the few people who have been able to assess NHF are the high earners. These high earners will obtain the N15m from NHF and likely add another N15m to N20m to it and buy in Lekki.
Yet, the low and middle class workers, end up contributing to NHF all their career. When they apply for the loan, the amount they would be eligible for after their long wait will be too small.
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Lagos Mainland, OgunRent To Own Schemes in Lagos and Abuja
Rent to own schemes too are not very popular. But these schemes can assist home buyers buy a house, move in and be paying later in Lagos or Abuja. Unlike NHF mortgage, the rent to own (RTO) are setup by state governments and private finance companies.
The Lagos State Government had a popular rent to own scheme during the launch of Lagos Homes. Although, that assisted a number of civil servants to move in to houses in Ikorodu, Igando, Ogba, etc.
For private rent to own schemes, very few exists, with the common low awareness trait. Most of the houses on the move and pay later on rent to own are also block of flats, this reduce the marketability as most offtakers prefer a bungalow.
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Lagos Mainland, OgunOffplan Houses in Lagos and Abuja
Houses for sale in Lagos and Abuja on offplan offers payment plan, depending on the credibility of the developer, payment plan can span between 18 to 60 months.
In Lagos, offplan house for sale in Lekki Phase 1, Ikate, and Ikoyi offers installment payment to subscribers and investors. Moreso, same payment plan are available for houses for sale in Ajah, Epe and houses around Ikeja.
Although offplan houses are mostly under construction. Consequently, you will have to wait for the house to be delivered before moving in.
OGUNRINU ZACCHAEUS DARAMOLA
Posted at 23:14h, 05 AugustCan I get a house that I will be praying small small for?
Mustapha Rabiu
Posted at 21:37h, 21 AugustGood afternoon, depending on the location you are interested, you can get those on installment from 6 to 60 months payment. However, if you are looking at NHF or Commercial mortgage to buy a house, you will be required to meet some certain criteria