INTERVIEW: Insecurity Boosting Our Business In Enugu – GM, Housing Corporation

Hon Chukwuemelie Lambert Agu is the general manager of Enugu State Housing Development Corporation. He says the population upsurge in Enugu due to insecurity in some parts of the country increases housing demands in the state. He spoke with Chinedu Aroh.

What innovations have you adopted to make housing affordable in the state?

We have started building houses for civil servants in the state. The cost of building houses is expensive. The determining factors include the prices of cement, sands, and iron roads. It is beyond our control. It is our wish that these houses become affordable.

We, therefore, began to partner with civil servants to give them extended payment plans for housing acquisition. Through a federal mortgage bank, AG Mortgage Homes, civil servants who have gone through our profiling can conveniently become landlords. We determine what each of them is due for. We have one-bedroom, two-bedroom and three-bedroom apartments, all in suites. The factors that we consider are the age, length of time remaining in one’s service career and the applicant’s salary grades.
We encourage civil servants to come up for profiling. They pay house rents, and at the end of the day, they leave the houses. Is it not better to acquire the house, and use the same rent to buy it by installments? They should take the money they are paying to landlords as their contributions to the NHF (National Housing Fund). This makes it easy for civil servants to acquire houses before their retirement.
Secondly, the interest rate is fixed at six percent, and it can never change until the expiration of the payment. In another three years, the house being paid for will triple its value. So the applicant has an option of selling it and making gains. It is a win-win situation.

What about non-civil servants who are interested?

It applies to everybody. We simply need to assess the person’s account to know the person’s monthly earnings to enable us to evaluate how much the person can conveniently pay back to NHF so that the payment plan won’t adversely affect the applicant’s lifestyle. Our regulation is that we don’t deduct more than 33 percent of the applicant’s monthly income. Both formal and informal sectors are highly welcome because we have different packages.

What is the process of profiling?

We deal more with cooperatives. For instance, we are working with the judiciary, Institute of Management and Technology, Enugu; Enugu State University of Technology, among others. We have cooperatives for Keke riders, plumbers, among others. But we also profile individuals. What we do is to take the applicant to the site to see. The good thing is that we have started the construction of the houses with our money. We are not waiting for the mortgage bank to release money to us. The first tranche here in Enugu is 108. Our intention is to be doing it in tranches.

How much support do you get from the state government?

We enjoy the goodwill of the state government. We are commercialised, so we are empowered to make profits and take care of our overheads. We are 100 owned by the state government. Some of the property we have are from the state, some from communities. What I mean by goodwill is that business cannot thrive well without security, or where there are chaos, harsh taxes and where titles are difficult to get. The good thing is that Gov Ifeanyi Ugwuanyi has been able to stabilise the security in the state. Hence, many people come from unsafe areas to live in Enugu State to enjoy peace. It is a boost to our business.

What determines the spread of your housing sites?

We have a land bank. Whenever we acquire property, whether we are going to develop immediately or later, we put it into our land bank. We also check our purse to know what to develop at every point in time. We choose our locations based on profitability because we have to make profits to run the organisation. We have our overhead costs and maintain old estates as well. These things can only be achieved with funds. We try as well to work in line with the agenda of the state. Enugu Central is already congested, so we are taking this development to the outskirts.

What challenges do you face in land acquisition?

Land to our people is becoming like oil to the country. Sometimes, factions emerge at communities that want to donate lands for development. What we do is to partner with communities. We don’t buy lands and invest as the case may be. Communities donate lands to us and we develop the property and give them their returns. We do valuation. We make them a part of the business. In terms of challenges, it is a whole lot agreeing with everybody. Some factions may go to court. Some people pursue their personal interests.

How does the population upsurge in Enugu affect your patronage?

Most of our off-takers are even from outside the country. Many people want to build at home. The insecurity in the country is also forcing many people to relocate to Enugu to invest because of the peace. The surge is an advantage to us.

Do non-Enugu indigenes key into this initiative?

We don’t discriminate between indigenes and non-indigenes. Enugu State is the capital of the East Central State, so we continue to maintain that status.

Tell us the cost implications

We are not selling only houses. We sell the environment, internal road networks, electricity, water reticulation, security, and beautiful gated estates. If you check the cost of the house, additional costs will be added, including drainages, earthwork, gates, water and all that. These are the cost elements of building a house. We are selling our one-bedroom apartment for N5.5m, all-inclusive. The payment spreads across thirty years. When the deduction is being made, one won’t feel it. We advise civil servants to rent and own. They live in their houses and pay gradually. In the case of initial deposits, it used to be 30 percent, but now it is 10 percent. It is not a must that one pays immediately. It can be done over six months or even a year.