FG plans commission to regulate housing sector

The Federal Government is considering the establishment of a housing regulatory commission with powers to license property developers and estate agents, as part of efforts to curb fraudulent transactions and recurring building collapses across the country.

The proposed reforms will also require developers to operate escrow accounts to protect buyers' money and strengthen accountability in an industry that contributed more than N77tn to Nigeria's economy in 2025.

The Minister of Housing and Urban Development, Muttaqha Darma, disclosed this on Tuesday in Abuja during a stakeholders' validation workshop on the proposed National Housing and Built Environment Regulation Policy and National Mortgage Industry Policy.

He said the housing sector had grown into one of the country's largest economic contributors but remained without a comprehensive regulatory framework to protect investors, homebuyers and tenants.

According to the minister, real estate services account for about 13.4 per cent of Nigeria's Gross Domestic Product, representing approximately N41tn, while the addition of the construction industry pushed their combined contribution above N77tn in 2025.

Darma said the absence of effective regulation had exposed Nigerians to fraudulent property developers and weak consumer protection.

"We never regulated housing. So our biggest sector is still the one where a man can print a brochure in the morning, collect a widow's savings by afternoon, and vanish before nightfall," he said.

Under the proposed policy, a National Housing Industry Regulatory Commission would be established with oversight responsibilities similar to those of the Nigerian Communications Commission and the Nigerian Electricity Regulatory Commission.

The commission would oversee the licensing of developers and estate agents, professional registration, construction standards, land administration and consumer protection.

The policy also proposes compulsory escrow arrangements to ensure that funds paid by prospective homeowners are protected rather than left entirely in the hands of developers.

Darma cited Dubai as an example of how regulation could transform the property market, noting that the city introduced compulsory escrow accounts in 2007 and established a real estate regulatory agency to supervise developers and agents.

He said Dubai recorded more than 270,000 property transactions valued at about $250bn in 2025.

"Dubai is smaller than Kano. The difference is not money. The difference is trust, and trust is manufactured by regulation," the minister said.

He also raised concerns about building collapses, disclosing that Nigeria had recorded more than 650 incidents and over 1,600 deaths since 1974.

"Those are not figures; they are funerals. Almost every one of those buildings had a designer, a builder and an approving officer. In most cases, nobody was licensed, and nobody was punished," he said.

On housing finance, the minister said the proposed National Mortgage Industry Policy would establish a National Housing Finance Authority and reform the Federal Mortgage Bank of Nigeria to improve access to home loans.

He disclosed that about six million Nigerians contribute to the National Housing Fund, which collects between N120bn and N150bn annually but records fewer than 500 mortgages.

The proposed reforms would also extend National Housing Fund participation to traders, artisans and commercial drivers, allowing them to contribute from N5,000 monthly.

A structured investment window for Nigerians in the diaspora is also being considered to attract additional funding into the housing market.

Darma further disclosed that the ministry's technical committee had adopted the World Bank Adequate Housing Index and the UN-Habitat Household Crowding Index to assess the country's housing shortage.

He said the committee estimated Nigeria's core housing deficit at about 15 million units, with the North-West and North-East facing the greatest pressure.

The minister described the workshop as the final stage of stakeholder consultations before the proposed policies are presented to the Federal Executive Council.
"This gathering is not a ceremony. It is the last door these policies pass through before the Federal Executive Council. What you say here will change what I carry to Council," he told participants.