FG Seeks End to Housing Fraud, Building Collapse With Regulatory Overhaul

The federal government has unveiled a plan to overhaul Nigeria’s housing sector through regulatory and institutional reforms aimed at ending housing fraud, curbing incessant building collapse, restoring investor confidence and unlocking the full economic potential of an industry now valued at over N77 trillion.

Speaking on Tuesday at the opening of the three-day Stakeholders’ Validation Workshop on the National Housing Data Programme and the Regulation of the Built Environment in Abuja, the minister of Housing and Urban Development, Dr Muttaqha Rabe Darma, declared that Nigeria could no longer afford to leave one of its largest economic sectors without an effective regulatory framework.

According to the minister, following the rebasing of Nigeria’s Gross Domestic Product (GDP), real estate services now contribute about 13.4 per cent of the nation’s economy, equivalent to approximately N41 trillion, making it the country’s third-largest sector ahead of telecommunications and crude oil. Combined with construction, the sector exceeded N77 trillion in 2025.

Despite its enormous contribution to the economy, Darma lamented that the industry remains poorly regulated, exposing millions of Nigerians to fraudulent developers, unsafe buildings and weak consumer protection.

He said unlike the banking, telecommunications, petroleum and power sectors, housing has operated for decades without a comprehensive regulatory regime.

“The biggest sector in our economy is still the one where someone can print a brochure in the morning, collect a widow’s life savings by afternoon and disappear before nightfall,” the minister said.

To reverse the trend, Darma announced that the federal government was validating two landmark policy documents that would soon be presented to the Federal Executive Council (FEC).

The first, the National Housing and Built Environment Regulation Policy, proposes compulsory licensing of developers and estate agents, escrow protection for buyers’ funds, professional registration, stricter construction quality standards, improved land administration, urban renewal without displacement and the establishment of a National Housing Industry Regulatory Commission.

The second, the National Mortgage Industry Policy, seeks to establish a National Housing Finance Authority, reform the Federal Mortgage Bank of Nigeria (FMBN), expand access to the National Housing Fund (NHF) for informal sector workers, including traders, artisans and commercial drivers, and create a dedicated mortgage window for Nigerians in the diaspora.

Darma argued that Nigeria’s weak mortgage system remains a major obstacle to home ownership, noting that although millions of workers contribute to the National Housing Fund annually, mortgage delivery remains extremely low.

He disclosed that while between ₦120 billion and Housing Fraud N50 billion is collected yearly through the NHF from about six million contributors, fewer than 500 mortgages are processed annually.

“Our mortgage-to-GDP ratio is between 0.02 and 0.07 per cent compared to about 30 per cent in South Africa and 70 per cent in Britain. That is not poverty; that is bad plumbing,” he stated.

The minister also blamed poor regulation for the country’s recurring building collapses, revealing that Nigeria has recorded over 650 building collapse incidents and more than 1,600 deaths since 1974.

According to him, stronger regulation, professional accountability and effective enforcement would significantly reduce such tragedies.

Drawing comparisons with Dubai’s real estate success, Darma noted that the emirate built investor confidence through strict regulation, including mandatory escrow accounts and comprehensive licensing of developers and estate agents.

He said those reforms helped Dubai record more than 270,000 property transactions valued at about 917 billion dirhams in 2025 alone.

“The difference is not money. The difference is trust, and trust is manufactured by regulation,” he said.

The minister further disclosed that the ministry’s Technical Committee has, for the first time, adopted internationally recognised methodologies developed by the World Bank and UN-Habitat to scientifically estimate Nigeria’s housing deficit at about 15 million units.

He urged stakeholders to rigorously interrogate the methodology during the workshop, stressing that Nigeria must end decades of conflicting housing deficit figures that have discouraged serious investment.

Darma said participants would spend the next three days reviewing proposals covering housing finance reforms, developer licensing, buyer protection mechanisms, land administration, urban renewal, implementation of the National Building Code, certification of artisans and the operational framework for a National Housing Data Centre.

Earlier, the Permanent Secretary of the Federal Ministry of Housing and Urban Development, Dr. Shuaib Belgore, said the workshop represented a major milestone in Nigeria’s efforts to establish a credible national housing data ecosystem and strengthen regulation of the built environment.

He noted that fragmented housing data, weak regulatory enforcement and poor institutional coordination had undermined effective planning, reduced investor confidence and contributed to poor building quality across the country.

Belgore disclosed that the ministry inaugurated a 13-member National Housing Data Steering Committee and a 20-member Technical Committee in 2024 to develop a sustainable national housing data framework.

According to him, the committees have already produced Nigeria’s first scientifically derived housing deficit estimate, developed a comprehensive National Housing Data Framework and laid the institutional foundation for establishing a National Housing Data Centre.

He added that the ministry had also constituted a ministerial task team to investigate the persistent incidence of building collapse and recommend comprehensive reforms to strengthen regulation of the construction industry.

The permanent secretary expressed confidence that recommendations from the workshop would provide a roadmap for implementing the National Housing Data Programme, improve public confidence in the construction industry, strengthen building safety and support the delivery of decent, safe and affordable housing across Nigeria.