Adeosun who disclosed this at the Affordable Housing Summit recently held in Abuja, noted that it would be ill-advised to channel pension funds to direct housing development, adding that potential role of pension funds in housing provision is much misunderstood.
“The pension funds have been frequently touted as a funding solution to most needs in Nigeria, including housing. Pension funds do represent a pool of long term funds, they are not an ideal source for housing at the development stage due to the high level of risk associated with this phase.
What pension funds need is predictable flow of annuity income to meet future pension payment obligations and this is provided at the mortgage phase rather than the development phase.” The minister asserted that what is needed in the development phase of housing provision, particularly at the early stage, is creative government intervention that will attract private capital. According to her, the government is planning to de-risk lending to approved housing developers in order to stimulate the growth of the sector, with appropriate safeguards.
Source :Vanguard
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