The Land Use Act has become a major obstacle to economic growth and needs urgent reform, says Chiedu Nweke, Chairman and CEO of Periwinkle Lifestyle Estate.
He describes the Act as anti-business, bureaucratic, and unfair to landowners. Initially enacted during the military era to simplify land acquisition, it now creates challenges that discourage investment and development.
Nweke explains that the law was introduced to give the government control over land because local communities resisted releasing it. However, this has led to unintended consequences. Businesses and individuals struggle to acquire land without government approval. Instead of supporting a thriving real estate sector, the Act gives governors too much power, limiting access to property for residential and commercial use. While the law had good intentions, Nweke insists that a review is necessary to create a balance between regulation and property rights.
Real Estate as a Key Driver of the Economy
Beyond land ownership concerns, Nweke highlights real estate as Nigeria’s largest industry. He believes it has the potential to drive employment, economic stability, and inflation control. With proper support, the sector could become a major job creator, reducing unemployment and poverty. He urges the government to recognize real estate as a key pillar of economic growth and implement policies that promote its expansion.
Mortgage System Fails to Support Homeownership
One of the biggest challenges in the industry, according to Nweke, is Nigeria’s failing mortgage system. As the founder of Orange Island, he has seen how difficult it is for Nigerians to access home financing. He attributes this failure to job instability and poor financial data tracking.
Unlike developed economies where employees maintain long-term careers and qualify for home loans, many Nigerians frequently switch jobs or face sudden unemployment. This makes them ineligible for mortgages. Only professionals in banking, oil, and multinational sectors benefit from these financial opportunities, leaving most citizens without access to homeownership.
High Construction Costs and Government Policies
Government policies directly affect real estate, influencing property prices and affordability. Nweke explains that rising construction costs, driven by high-interest rates and expensive building materials, make homeownership increasingly difficult. He believes the government should take action by reducing regulatory fees, streamlining land approval processes, and offering incentives to local manufacturers of cement and other building materials.
He suggests that similar policies used in the petroleum sector could also work in real estate. If the government supports local industries, housing costs will decrease, making homeownership more accessible.
Urgent Reforms Needed for a Thriving Housing Market
For Nigeria’s real estate sector to thrive, urgent reforms are necessary. Nweke emphasizes that removing outdated laws, improving mortgage accessibility, and supporting local industries will create a more inclusive and sustainable housing market. Without these changes, homeownership will remain out of reach for many, and Nigeria will miss out on the economic benefits of a thriving property sector.
