In a renewed effort to make homeownership more accessible and affordable for Nigerian workers, Federal Mortgage Bank of Nigeria (FMBN) has kick-started the implementation of a rent-to-own housing scheme.
The FMBN rent-to-own scheme is an innovative affordable housing product, which provides an easy and convenient payment plan towards homeownership for Nigerian workers.
The scheme is specifically designed to make it possible for Nigerian workers to move into FMBN homes as tenants, pay for and own the properties through monthly or yearly rent payments spread over periods of up to 30-years.
To further increase affordability, the properties will also attract a single digit interest rate of 9 per cent on the price of the property on an annuity basis. The product will cover properties with the maximum value of N15 million.
The rent-to-own housing product targets Nigerian workers who are contributors to the National Housing Fund (NHF) and will be implemented in phases. About 3,000 houses are planned for the pilot phase.
To deliver on the rent-to-own housing scheme, FMBN will partner with reputable estate developers for the construction of quality, cost-effective housing stock nationwide. Payments for the houses will be domiciled with the CBN through the Treasury Single Account (TSA).
Properties that are planned for the rent-to-own scheme are existing estates that are funded by FMBN nationwide and non-funded estates.
FMBN Managing Director/Chief Executive Officer, Ahmed Dangiwa said that the rent-to-own is yet another groundbreaking initiative of the bank that is targeted at increasing access to affordable housing by Nigerian workers who fall into the low-medium income brackets.
“The rent-to-own housing product is designed to make sure that any worker who collects a salary should be able to live in his own home and pay conveniently over periods as long as 30-years! This is a massive relief especially given how little workers earn. I am delighted that we have successfully added this product to the many other initiatives that we have made possible to make homeownership a lot easier for Nigerian workers,” he said.
The FMBN MD/CEO commended President Muhammadu Buhari for his commitment to the development of housing and the Minister of Power, Works and Housing, Babatunde Raji Fashola for his continual support for the ongoing reforms to re-position FMBN on the path of efficiency and impact.
He stated that the implementation of the scheme will totally eliminate the burden of equity contributions by workers for housing loans, complement the existing products of the bank by widening the home ownership bracket, increase housing stock, and help the bank to utilize abandoned estates that are to be transferred to the scheme.