The Alexandra Courts Coastal City, a new 5,000-unit housing estate being built in Ibeju-Lekki, Lagos, is offering potential subscribers the opportunity to become homeowners via rental payment.
According to Deacon Jide Durojaiye, Managing Director, Legrande Properties Development Company Ltd, developers of the N48 billion estate, subscribers can make rent payments each month and a portion of those payments will count toward their down payment. He added that, should they decide to buy, the excess money can be applied to the home purchase.
He said: “Rent-to-own homes are homes that include a clause in the rental agreement which either gives you the option to buy or an obligation to buy after a certain time period.
“Renting to own can be an appealing concept for people who are interested in owning property but have thus far been shut out of the traditional homebuying process.
“If you don’t have a sizable down payment, for instance, or your credit score is too low to qualify for a mortgage, renting a property with the intention to buy it can give you time to save and work on improving your credit rating.“
Durojaiye advised Nigerians to embrace the rent-to-own scheme housing finance model to meet their shelter needs.
He said that the model was largely untapped in Nigeria, and urged governments to provide enabling environment to popularise the option.
Durojaiye, speaking when journalists undertook a tour of the firm’s projects in Ibeju Lekki on Thursday, August 17, 2023, said that the model was making housing finance and home ownership easier in developed countries, and would help to bridge housing deficit.
He described the Alexandra Courts Coastal City, which features two- and three-bedroom flats as well as semi-detached and fully-detached duplexes together with requisite infrastructures, as a Public Private Partnership (PPP) with the Lagos State Government and Federal Mortgage Bank of Nigeria (FMBN).
“Loans are available to offtakers who are contributors to the National Housing Fund (NHF) Scheme up to N15 million,“ Durojaiye stated, even as he listed the requisite milestone payment required under the NHF payment plan to include:
- 30% of the purchase price to be paid within 7 days upon acceptance of the offer letter.
- 20% of the purchase price upon completion of the first-floor slab.
- FMBN would issue N15,000,000 when the purchaser is purchasing three-bedroom flat to us on your behalf.
- N4,000,000 only to be paid upon completion of the third-floor slab.
- N4,000,000 to be paid upon completion but before handing over of the unit.
He said: “Legrande will help the subscriber secure the said N15,000,000 or N14,000,000 loan from the Federal Mortgage Bank of Nigeria provided the subscriber is a contributor to the National Housing Fund Scheme, and the subscriber will only be expected to start repaying the loan sum to FMBN after the unit has been completed and handed over to the subscriber.
“However, the title document would be issued to FMBN in trust for the repayment of the loan and, upon completion of the payment of the loan sum which takes 30 years depending on the subscriber’s current age, the title document will be handed over to the subscriber by the FMBN.
“Legrande already has a primary mortgage bank that they are working with which is AG Mortgage Bank. It is through this bank that all subscribers’ documents would be submitted to FMBN on their (subscribers’) behalf for the processing of the loan.“
Durojaiye noted that, to be eligible for the rent-to-own scheme, applicants must have registered with the National Housing Fund for a period of not less than six months with consistence NHF remittances, applicants must be first time beneficiaries of the NHF loan, and applicants must have verifiable means of income.
Prices of houses in the estate, which comes with a solar system that provides 24 hours lighting, are N36 million for a two-bedroom flat, N46 million for a three-bedroom flat, and N22 million for a plot of land.
Other payment plans include outright purchase which includes payment of the entire purchase price at the beginning of the transaction, and milestone payment without the usage of NHF, which includes: 30% of the purchase price to be paid within seven days upon acceptance of the offer letter, 30% upon completion of the first-floor slab, 20% upon completion of the third-floor slab, 10% upon commencement of internal finishes, and 10% upon completion but before handing over of the units.
According to Durojaiye, the construction of the estate would span five years and the first phase of the project, comprising 12 16-flat blocks, will be delivered in March 2024, while the second phase of 20 blocks will be completed December 2024. Construction of 3,000 units of terrace houses would commence by 2025, he added.
The realtor said Nigerians were under-utilising opportunities for mortgage finance offered by the FMBN.
He said the rent-to-own offered opportunity for affordable mass housing.
“As I am talking to you, they (FMBN) have money and people are not using them,” he said.
He described the rent-to-own model was the most convenient way for people to own their homes, with the benefit of loans from mortgage institutions and Pension Funds.
He said the rent-to-own investments of the state government in the Alexandra Courts would unlock potential, add value, enhance urban renewal efforts and solve various challenges to provide affordable housing for residents.
He called on all levels of government and Nigerians to embrace the rent-to-own scheme to address accommodation problems and housing deficits.
He said the Alexandra Courts Costal City, Ibeju-Lekki project called “The New Lagos“ had all infrastructure and facilities that offered comfort and safety.
“The New Lagos“ refers to mini cities around the new proposed airport and seaports, Lekki Free Trade Zone and Refinery.
The realtor listed facilities in the estate to include: Independent Power Project, schools, hospital, swimming pool, central park, playground, a helipad, gym and other recreational sports area, central mall, health centre, central internet connection, as well as sewage and water treatment plants, among others with moderate service charge.