ASSESSMENT OF HOUSING AFFORDABILITY BY LOW INCOME EARNERS IN GWAGWALADA, FCT, ABUJA
ABSTRACT
The main purpose of this study is to carry out assessment of housing affordability by low income earners in Gwagwalada, Abuja. This project is divided into five chapters. Chapter one introduces the topic to highlight the importance and objectives of the study and depict the scope of the study and historical background of the study area. Chapter two discuses a great deal of view documented by previous writers on housing affordability. Chapter three discuses research methodology. This is the method employed in collection of data. Purposive sampling technique was used to carry out this research. Chapter four deals with analysis of data with the view of interpreting the data collected to arrive at the research findings. Chapter five considers some facts and findings, the following recommendations were made in the research; government should implement effective programs aimed at providing housing, encourage and involve private investors to construct houses that will cut across all classes of people, loans should be made more available and accessible to the low income group, reduced cost of building material and labour, land should be made accessible to potential builders, encouragement of mass production of local building materials, facilitation and encouragement of building development societies.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The significance of housing as a major determination of man’s welfare, life sustenance and survival cannot be overemphasized. Provision of housing as a requirement comes next after food.
Housing is an integral part of human settlement that fulfils basic need and has a profound impact on the quality of life, health, welfare as well as productivity of man. It plays a crucial role in integrating physical and economic development, environmental sustainability, natural disaster mitigation and employment generation as well as wealth creation (Erguden, 2001; Boehm and Schlottmann, 2001; UN-HABITAT, 2006a).
The desire for adequate and affordable housing also has strong links to the need for security, safety and proper socio-economic status of individuals and communities. In spite of this widely acknowledged importance of housing and various efforts in making adequate and affordable housing available to majority of people, a large proportion of urban residents in less developed countries for instance, in Nigeria, do not have access to decent housing at affordable cost (Tipple,2004; 2006; UN-HABITAT, 2006a; Greene and Rojas, 2008).
In developing countries like Nigerian, the problem of housing is more noticeable than in developed countries. Moreover, the shortage of housing in Nigeria in the urban areas is more noticeable and critical than in the rural areas.
As a result, most urban residents in Developing Countries live in housing conditions that constitute an affront to human dignity and which comes with appalling social, economic, spatial and health implications (Rondinelli, 1990; Cotton and Tayler, 1994; Opara, 2003; UN-HABITAT, 2006d; Coker et al., 2007; UNFPA, 2007). Hence, inadequate housing condition has become an intractable challenge that has continued to receive attention from governments and individuals in many developing countries.
In line with human tradition which seeks to investigate, describe, understand and proffer solutions to ameliorate defects in human conditions, and enhance individual and collective well-being; both public and private sectors have continued to take concerted efforts at addressing the social and economic challenges posed by inadequacies in housing provision in many countries of the world. These efforts have informed legislations, policies, strategies and reforms, which most often have culminated in various housing programmes (Onibokun, 1985; Rondinelli, 1990; Ajanlekoko, 2002; Sengupta, 2005; Sengupta and Sharma, 2008). Governments in many developing countries have engaged in different housing programmes and delivery strategies. For example, previous studies have shown that successive administrations in Nigeria had launched a minimum of seven public housing programmes in the last few decades in a bid to address increasing housing challenges in the country (Onibokun, 1985; Awotona, 1990; Ogu, 1999; Ogu and Ogbuozobe, 2001; Ajanlekoko, 2002; UN-HABITAT, 2006; Akinmoladun and Oluwoye, 2007; Ademiluyi and Raji, 2008).
However, substantial literature on public housing in developing countries has revealed three main streams of criticism (Mukhija, 2004). First, it is argued that most public housing schemes are inefficient and ill conceived, and thus failed to meet the needs of target population (Rondinelli, 1990; Mba, 1992). Second, direct government involvement in housing provision is viewed as being negligible compared to the volume of housing provided by informal private sector (UN-HABITAT, 2006a; 2006c). Finally, government intervention in the housing market to check rising cost of housing is seen as counter-productive and an impediment to smooth operation of housing market and efficient housing delivery system (Sengupta and Ganesan, 2004; Mukhija, 2004).
Consequently, many scholars and stakeholders have argued that government has no business in providing housing for people, but rather government should act as a partner, enabler and facilitator of housing process by making available appropriate incentives, policy and good regulatory environment necessary for effective private sector participation in housing provision (World Bank, 1993; UNCHS, 2000). In view of this, there is an emerging consensus that current approaches to public housing be based on market-friendly policies and strategies that encourage reduction in government’s direct involvement in public housing provision.
Ong and Lenard (2002) and UN-HABITAT (2006) were however of the opinion that this does not necessarily mean reduction in government’s social responsibility in providing housing for the citizens, but rather it implies the production of housing through collaborative approach in an integrated manner.
In the light of foregoing criticisms coupled with the need for sustainable solution to burgeoning housing challenges; most governments in developing countries are engaging in new housing policies, programmes and strategies that seek to meet demands of market-driven economies in addressing housing needs of their people (Sengupta and Ganesan, 2004; Sengupta, 2005; Sengupta and Sharma, 2008). In Nigeria for instance, current approaches to public housing provision are based on private sector-driven strategies (National Economic Empowerment and Development Strategy, 2004; Aribigbola, 2008; African Ministerial Conference on Housing and Urban Development, 2008). Surprisingly to date, the outcomes of those strategies, reforms and programmes are yet to be empirically evaluated in many of these countries, including Nigeria.
It is in light of the above that this study was set to carry out assessment of housing affordability by low income earners, a study of Gwagwalada, Federal Capital Territory.
1.2 STATEMENT OF THE PROBLEM
Housing problem has been generally accepted as being diverse and complex. Within the spectrum of this problem, one can identify both qualitative and quantitative deficiencies. Housing problem is worldwide and it is of a recurring nature, in fact it is doubtful if any nation of the world can satisfactorily meet its housing requirement.
In Nigeria, most people live in poor quality house and poor sanitary environments. The problem of inadequate housing has been compounded by the rapid rate of urbanization and economic growth. Housing difficulties is more serious for the low income group where problems have been complicated by rapid growth, inflated real estate values, speculative activities, influx of poor immigration and lack of planning.
It is because of the above problems that this research is set to carry out an assessment of housing affordability by low income earners in Gwagwalada, FCT.
The definition of low income group according to FGN (2004) is all employees and self-employed persons whose annual income is equivalent to salary grade of 01-06 within the public service. Interestingly, the national minimum wage is now N18, 000 (Adedeji and Olotua, 2012; Fapohunda et al., 2013) or ($47, per month at the rate of N380 per $1.) This observation is corroborated by the previous UN Human Development Report of (2009) which remarked that 83.9% of Nigerians live below $2.00 a day and cannot afford decent accommodation and pay the market rent rates and other incidental expenses to most landlords, who are pressed to get returns on their housing investments as soon as possible. The World Bank observation that the country needs to produce about 720,000 housing units annually for the next 20 years to solve the problems which indicates the enormity of the housing problem. Arguably the Nigeria 2020 development strategy which includes a vision to build 10,398,650 housing units between 2012 and 2020 (Housing Finance in Africa Yearbook, 2012, pp.111) reinforces the Word Bank assertion.
1.3 AIM AND OBJECTIVES OF THE STUDY
The aim of this study is to assess housing affordability by low income earners in Gwagwalada, F.C.T. The specific objectives include the following:
1. To examine or measure housing affordability in Gwagwalada, FCT.
2. To identify and examine the various programs aimed at providing affordable housing to low income earners in Gwagwalada.
3. To examine the extent of their implementation in Gwagwalada
4. To identify problems faced by low income earners to access affordable housing and suggest possible solutions.
1.4 RESEARCH QUESTIONS
The following research questions were formulated to guide this study:
- How can housing affordability be measured or examined in the study area?
- How can the various programs aimed at providing affordable housing to low income earners be identified and examined?
- What are the extents of their implementation in the study area?
- What are the problems faced by the low-income earners in accessing affordable housing and to proffer possible solutions to the identified problems in the study area.
1.5 SIGNIFICANCE OF THE STUDY
In this study, the researcher set out to assess housing development and the affordability in Gwagwalada with the aim of highlighting the inherent problem facing low income earners in assessing affordable residential housing. It is expected that this work will be of interest to government, students and the general public. This study will also help to serve as literature (reference source) to government at all level, students, individuals or corporate bodies who want to carry out further research on housing development and affordability in Gwagwalada. A reliable and efficient measure of housing affordability is very important for local policy makers for a number of reasons; Firstly, an efficient measure of housing affordability is often used as the basis for allocating government funds for housing programs, Secondly, individuals can utilize this measure to make informed decisions about where to live and Thirdly, the housing affordability measure can assist government agencies and non-profit organizations to develop realistic estimates, and thus utilize public funds more efficiently.
1.6 SCOPE AND LIMITATIONS OF THE STUDY
The scope of this study is restricted to the assessment of housing affordability by low-income earners in Gwagwalada. The study will cover only Gwagwalada Local Government Area with reference to selected areas and known structures.
The limitations encountered are of distance and its attendance cost of travel in order to obtain the needed information which to write this study. Another limitation to the study is short time factor which did not give the desired opportunity for thorough research work, hence gathering adequate information becomes very difficult. Therefore, the researcher resolved to seek friendly approach in order to obtain the needed materials or information from the area under study through the administration of questionnaire.
1.7 DEFINITION OF TERMS
- Housing: Housing is defined as buildings or structures that individuals and their family may live in that meet certain federal government regulations. Housing Development
- Affordable Housing: Affordable housing is housing deemed affordable to those with a median household income as rated by country, State (province), region or municipality by a recognized Housing Affordability Index.
- Income: Income is the consumption and savings opportunity gained by an entity within a specified timeframe, which is generally expressed in monetary terms (Barr, 2004). However, for households and individuals, income is the sum of all the wages, salaries, profits, interests,. Payments, rents, and other forms of earnings received in a given period of time.
- Accommodation: It is lodging in a dwelling or similar living quarters afforded to travelers in hotels or on cruise ships, or
- Management: Management in organizations is the function that coordinates the efforts of people to accomplish goals and objectives by using available resources efficiently and Housing Development
1.8 HISTORICAL BACKGROUND OF THE STUDY AREA
Before the creation of Federal Capital Territory, Gwagwalada was under the Kwali District of the former Abuja emirate now Suleja emirate. Gwagwalada Area Council was created on 15 October 1984. Its official population figure of 158,618 people at the 2006 census. The relocation of the seat of government from Lagos to Abuja in 1992 and the recent demolition of illegal structures within the Federal City Center brought a massive influx of people into the Area Council being one of the fastest growing urban centers in the FCT. The population of the Area Council has grown to over 1,000,000 people. Gwagwalada Area council is one of the five Local Government Area Councils of the Federal Capital Territory of Nigeria, together with Abaji, Kuje ,Bwari , and Kwali ; the FCT also includes the City of Abuja .Gwagwalada has an area of 1069.589 km 2.
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