CHAPTER ONE

INTRODUCTION

1.1   BACKGROUND TO THE STUDY

The housing
sector plays a more critical role in a nation’s welfare than is always
recognized, as it directly affects not only the citizenry, but also the
performance of other sectors of the economy. Adequate housing provision has
since the early 1970s consequently engaged the attention of most countries,
especially the developing nations for a number of reasons. First, it is one of
the three most important basic needs of mankind- the others being food and
clothing. Secondly, housing is a very important durable consumer item, which
impacts positively on productivity, as decent housing significantly increases
worker’s health and wellbeing, and consequently growth. Thirdly, it is one of
the indices for measuring the standard of living of people across societies
(Sanusi, 2003).

Propelled by
the patriotic quest of addressing Nigeria’s acute housing problem, the Federal
Government came up with a National Policy on Housing and Urban Development in
2002. The policy has since then triggered milestone reforms in the nation’s
housing industry aimed at repositioning it for efficient and effective housing
delivery and maintenance. One of the means through which the policy is been
achieved is on public-private partnership concept. The thrust of the policy is
to raise the home ownership rate among Nigerians to a respectable level by
moving the housing industry to sustainably deliver mass, decent and affordable
housing with the active participation of the private sector-driven mortgage
based housing delivery and maintenance system (Oduwaye, 2004). The policy
believes that this will particularly address the housing problem of most
Nigerian citizens.

The concept of
private partnership in housing financing, delivery and maintenance system is
predicated on the pooling together of resources from the various stakeholders,
each party making inputs, thereby minimizing wastage and maximizing results
achieved. Ikekpeazu (2004) stressed that the expediency of the increased
adoption of the public-private partnership for housing financing and delivery
in the present socio-economic circumstances of shortage of housing in Nigeria
is now even more glaring than ever. With the increasing demand of the
population on the national economy and the government’s propensity for
enlarging the multi-sectorial allocations in terms of finance, it is becoming
obvious that government alone can no longer provide adequate housing for all
categories of her citizens particularly the low income earners.

The organized
private sector comprise of members of the real estate developers association of
Nigeria and some commercial banks that have real estate departments.Average citizens including the low-income earners do
not easily have access to housing finance because of their low wages. Nigeria
is a country with high unequal income distribution, a situation that restricts
the reach of the vast majority in the acquisitionof quality housing. This study
examines the role of public-private partnership in housing finance, delivery
and maintenance in Nigeria.

The public-private partnership for housing delivery under Nigeria’s
current housing policy (Abdulsalam, 2008) confers certain identifiable roles on
both the public and the private sector. The roles of the private sector in housing
financing, delivery and maintenance with particular reference to private
partnership includes responsible for production of physical houses, responsible
for primary mortgage lending, required to invest mortgage securities and responsible
for the production and supply of building materials, particularly local
content.

1.2   STATEMENT OF THE PROBLEM

Housing
finance constitutes one of the major pillars of housing delivery and
maintenance system. Indeed, without a well-organized and efficient housing
finance mechanism, the goal of a housing development and maintenance policy
will be largely unattainable. Housing finance has been recognised as an
important, almost indispensable factor in the housing delivery and maintenancesystem.
This is because only the very few in any nation can afford to pay cash for a
house or pay cash for a major renovation of the house. Most other people must
have to finance their house building and maintenance through loans, personal
savings, assistance from relatives or friends and gifts. Introduction of
public-private partnership in housing delivery and maintenance is to enhance
the productivity of the housing sector, increase housing affordability and
improve access to basic infrastructure and social services. Ikekpeazu (2004)
stressed that in order to attain the desired outcome for private partnership,
the perception of the housing sector as a vast arena of social problems and a
drain on the economy must change. Housing must be seen as an important economic
sector with crucial linkages to the overall economy of a nation. The housing
sector is a key component of the economy. It is typically the largest single
form of fixed capital investment, in most economics. Based on these facts, the
researcher seeks to examine the role of private partnership in house finance,
delivery and maintenance in Nigeria.

1.3   OBJECTIVES OF THE STUDY

The following are the objectives of this study:

1.  To
examine the role of
private partnership in house finance, delivery and maintenance in Nigeria.

2.  To ascertain the level of investment in housing
delivery and maintenance in Nigeria.

3.  To identify the problems of housing finance, delivery
and maintenance in Nigeria.

1.4   RESEARCH QUESTIONS

1.  What
is the role of private
partnership in house finance, delivery and maintenance in Nigeria?

2.  What is the level of investment in housing delivery
and maintenance in Nigeria?

3.  What are the problems of housing finance, delivery and
maintenance in Nigeria?

1.5   HYPOTHESIS

HO: Private partnership has not
contributed to housing finance, delivery and maintenance in Nigeria.

HA: Private partnership has contributed
to housing finance, delivery and maintenance in Nigeria.

1.6   SIGNIFICANCE OF THE STUDY

The following are the significance of this study:

1.  The
results of this study will educate the general public on the role of public
private partnership and how it can be used as the instrument of development in
housing finance, delivery and maintenance.

2.  The
findings will sensitize the stakeholders in building construction and real
estate management on the need for effective collaboration with the private
sector to ensure speedy financing and delivery of housing units all over the
country noting that private partnership has facilitated development in housing
delivery and maintenance in other advanced countries of the world.

3.  This
research will also serve as a resource base to other scholars and researchers
interested in carrying out further research in this field subsequently, if
applied will go to an extent to provide new explanation to the topic.

1.7   SCOPE/LIMITATIONS OF THE STUDY

This study on the role of private partnership in
housing finance, delivery and maintenance in Nigeria will cover the involvement
of private sector in the provision and maintenance of housing units with focus
on the existing housing structure and management in Nigeria.

LIMITATION OF STUDY

1.  Financial
constraint–
Insufficient fund tends to impede the efficiency of the researcher in sourcing
for the relevant materials, literature or information and in the process of
data collection (internet, questionnaire and interview).

2.  Time
constraint– The
researcher will simultaneously engage in this study with other academic work.
This consequently will cut down on the time devoted for the research work.

REFERENCES

Abdulsalam, A. (2008): Public-Private Partnership in Housing Finance at
a seminar organised by the Nigerian Institute of Estate Surveyors and Valuers
(Ondo State Branch), held on the 13th of November, 2008, at Owena-Nicon
Luxury Hotels, Akure.

Ikekpeazu, F. (2004): New Trends in Low-cost Housing delivery systems in
Nigeria: An Overview of the public-private partnership approach.  Housing Today, 1 (8), 30 – 36.

Oduwaye, L. (2004): Problems and Prospects of Primary Mortgage
Institutions (PMIs) in Nigeria: Case of selected PMIs in Lagos. Housing Today,
1 (8) 14-18.

Sanusi, J. O. (2003): Mortgage Financing In Nigeria:
Issues And Challenges, a paper presented at the 9th John Wood
Ekpenyong Memorial Lecture, organised by the Nigerian Institute of Estate
Surveyors and Valuers, April 29, 2003.

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