Nigerians may need to pay up to N22 million to own one-bedroom apartments under President Bola Tinubu’s Renewed Hope Estates Programme, according to the Federal Minister of Housing and Urban Development, Musa Dangiwa. The announcement was made during a presentation at the State House Gallery, Aso Villa, where the minister provided a breakdown of the cost differences in housing units developed under this initiative.
Dangiwa clarified that one-bedroom apartments built directly by the government under the Renewed Hope Estates Programme are priced between N8 million and N9 million. However, those constructed under a Public-Private Partnership (PPP) model in the Renewed Hope Cities cost significantly more, with prices reaching N22 million.
The minister attributed this substantial pricing gap to differences in the funding mechanisms used for the two models. He explained that housing units under the Renewed Hope Estates are subsidized through government budgetary provisions. These provisions include interest-free funding, state-donated land, and government-subsidized infrastructure, which reduce the overall cost of the units.
In contrast, housing under the Renewed Hope Cities, developed through PPP arrangements, is privately financed. Developers in this model must purchase land and secure loans with double-digit interest rates, significantly driving up costs.
Furthermore, the government facilitates a Bankable Offtaker Guarantee from the Federal Mortgage Bank of Nigeria (FMBN) to ensure viability, but the financing still affects the final pricing.
Dangiwa elaborated on the rationale for adopting the PPP model, pointing out Nigeria’s critical housing deficit. The country needs approximately 550,000 new housing units annually for the next decade to meet demand, which requires an estimated funding of N5.5 trillion per year. Given the limited funds available through government budgets, public-private partnerships are essential to increase housing supply and address the shortfall.
He also clarified the target demographics for each housing scheme. The PPP-driven Renewed Hope Cities are designed for middle- and high-income earners who can afford housing at market rates. Meanwhile, the Renewed Hope Estates, funded by government subsidies, aim to provide affordable housing options for lower-income Nigerians, ensuring equitable access to housing opportunities.
This strategy, the minister noted, reflects a balance between addressing the housing needs of low-income groups and leveraging private sector investment to cater to more affluent segments of society.
