The Federal Minister of Housing and Urban Development, Musa Dangiwa, has revealed that government-funded one-bedroom apartments under the Renewed Hope Estates Programme cost N8 million to N9 million.
However, those developed through Public-Private Partnerships (Renewed Hope Cities) are priced at N22 million.
Dangiwa attributed the price disparity to differences in funding mechanisms, noting that Renewed Hope Estates are funded through budgetary provisions with subsidies for infrastructure and free land, ensuring affordability.
In contrast, Renewed Hope Cities, exclusive to the PPP model, rely on private developers who finance projects through high-interest loans and bear land acquisition and infrastructure costs, driving up prices.
The Housing Minister made this disclosure during a presentation at the State House Gallery, Aso Villa, on Sunday, 17th November 2024, with the speech later shared on the official website of the ministry.
“A one-bedroom apartment at the Renewed Hope City in Karsana, built under a PPP model, costs about N22 million, whereas a similar unit under the Renewed Hope Estates, funded through budgetary allocations, costs approximately N8–9 million.
“The difference lies in the cost of finance. Under the Renewed Hope City model, developers purchase the land, and secure financing at double-digit interest rates, while as government, we facilate a Bankable Offtaker Guarantee from the FMBN. In contrast, Renewed Hope Estates are funded with interest-free allocations from the budget. State governments provide free land, and infrastructure costs are subsidized and excluded from the housing unit prices,” Dangiwa stated.
The Housing Minister outlined the rationale for adopting the PPP model, pointing to Nigeria’s housing deficit, which requires 550,000 units annually over the next decade at an estimated cost of N5.5 trillion per year. He explained that budgetary allocations alone are insufficient, making PPPs a critical strategy to scale housing delivery.
Dangiwa emphasized that PPP-driven Renewed Hope Cities cater to high- and middle-income earners who can afford market-rate housing, while Renewed Hope Estates are tailored for lower-income groups, ensuring inclusive access to housing.
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Dangiwa also highlighted the urgency of increasing the annual housing budget to effectively address Nigeria’s significant housing deficit, emphasizing that while PPPs are essential, the government must also allocate more funding to the Renewed Hope Housing Programme.
“As a Ministry, we have championed this advocacy, and there is now widespread recognition that the current N50 billion annual budget for housing is grossly inadequate compared to the N5.5 trillion required annually to address the housing deficit,” he said.
- The Minister stated that the Ministry has engaged the National Assembly leadership and gained their support for increasing the annual housing budget to a minimum of N500 billion, starting with the 2025 budget cycle.
- This increase, he noted, would enable the expansion of housing projects to cover the remaining 18 states and raise the unit count per state from 250 to at least 500, as originally planned.
The Minister reiterated that this funding boost is critical for ensuring the Renewed Hope Housing Programme meets its goals of addressing the housing needs of all Nigerians, particularly those in underserved areas, while expanding its reach and impact nationwide.