Real Estate Investment: COPERATIVE SOCIETY APPROACH TO HOUSING FINANCE IN NIGERIA

ABSTRACT

Housing is essential for human existence and its procurement requires huge capital its provision is base on the availability of finance.

Thus the Yaba College of Technology staff cooperative society was established to widen the role of private sector in housing finance in Nigeria.

Therefore, this study is conducted to assess the impact of NCSN’s bringing about a better healthy housing environment condition. This research therefore critically examines finance housing development in Nigeria.

The methodology of the research work describes the procedure followed in realizing the goals and objectives of this research.

Data used for analysis where gotten from Yaba College of Technology staff cooperative society this represents 20% of the total.

Generally this study discovered that the study of Yaba College Of Technology staff, cooperative society is not performing to a significant level because of the shortage of funds, default in loan payments due to this the government should establish appropriate institutional framework to facilities effective planning and restricting all the NCSN’S.

INTRODUCTION

The housing delivery system in Nigeria is a combination of interrelated processed. As such, housing problems are multifarious and requires multidimensional solutions. Nigerians diverse housing problems revolve around over-crowding and slum housing. Many Nigeria cannot afford decent homes. They live in shelter and not housing. Government overtime has intervened in the housing sector by increasing housing stock through the construction of housing estates and through its mortgage institutions, facilitated the disbursement of housing loans. These measures have done little to address the situation. On the other, houses provided by the private sector operators are out of the economic reach of even the medium income earner. An effective and realistic strategy for providing decent environment at decent prices is therefore crucial. Various authorities have proffered strategies for improving housing delivery. Fasakin (1998) suggested that the cooperative housing movement should be given a closer look. Oduwaye (1998) posits that the rigid bureaucratic system of government should be team lined, while issue of land allocation and housing finance should be addressed. Omole (2oo1) suggested that financial institutions should be move accessible to the people. Cooperative housing has been successfully implemented in many countries including Sweden, Denmark, Norway, Canada and South Africa. Judging from the inherent success of cooperative movement in Nigeria, this project seeks to examine the cooperative housing system as a pragmatic tool for improving housing delivery. In order to fully achieve this, the dissertation look at the structure, types and benefits of the system and gives further to the evaluate the impact of the system in Australia and the United States of America, with a view of determining the applicability of cooperative housing in Nigeria in the face of present socio-economic realistic.

AIM AND OBJECTIVES

Keeping the subject matter in view, this study is design to pursue the under listed objectives with the aim of to examine the role of cooperative societies in financing housing delivery in Nigeria. (A study of Yaba College of Technology staff cooperative society)

The objectives are;

· Examines adequacy of available of housing finance in the study area.

· Determines government and individual contributions to the role of cooperative society and housing delivery in NIGERIA

· Analyzing the impact of cooperative societies in housing delivery

· Identifying various factors militating cooperative societies in financing housing delivery in Nigeria.

SCOPE OF THE STUDY

The scope of this study is limited to the role of cooperative societies in financing housing in Nigeria. (Study area Yaba College of Technology staff cooperative society).

SIGNIFICANCE OF STUDY

This study will be significance to various Estate Management professionals and also to various people; these people include the government and cooperative societies. It will serve to sensitize the ordinary man to the inherent benefit in financing housing delivery. It is important to keep the physical function aspect of the estate under supervision so that improvement can be made where necessary. It serves as a source of reference for research purpose and will be and will be subject to criticism and analysis. It will also awaken the

Cooperative societies to its role in financing housing delivery in Nigeria.

DEFINATION OF TERMS

COPERATIVE SOCIETY can simply be defines as the association of person usually of limited means who have come voluntarily, democratically by pulling their resources in order to achieve the social economic objective of and having a fair share of risks and benefits.

HOUSING: Simple means the physical structure that man uses for shelter and desired for the physical and mental health and social wellbeing of the family and individuals.

According to TUNDE AGBOLA he describes housing as a multi-dimensional bundle of services, is also a bundle of contradictions and paradoxes.

Also M.A.JINADU defines housings as a shelter or lodging for human habitation. He also view housings as a bundle of services or a basket of goods which includes the physical structure itself, the ancillary facilities and services within and around it as well as the genera environmental amenities that surround the building.

HOUSING FINANCE: Is a network of series of financial flows between saving capture and housing investment, using many agents who operate and execute different aspect of the process

COPERATIVE HOUSING: This is the cooperative of people or families organized as a group to provide housing for members of the group.

COLLATERAL SECURITY: Implies the property of goods given out before loan can be issued.

LOAN REPAYMENT: Implies the manner or ways, in which the loan given will be pay back.

LOAN DISBURSEMENT: Refers to the ways or the condition which loan is being given out.

LITERATURE REVIEW

INTRUODUCTION

Housing is attached to human existence and it is beyond mere shelter but includes facilities, services in the house, conditions of occupancy and the entire neighborhood. Delivery housing and finance are the major considerations are enumerated below;

FINANCE: Is the life wire of any investment. The method of financing a housing scheme varies depending. Once a status of the authority or persons concerned. Once a project has been decide upon the next problem requiring urgent attention is the question of what institution to approach for the necessary financial assistance. The procedure involving land acquisition appointing the relevant professionals designing the house, observing town planting regulations, the main construction stage and maintenance process all with their respective attendant cost implication. The process of other human needs could be measure in few hundreds of Naira or less which prices of houses are usually measured in hundred of thousand of millions of Naira. Due to high cost of house, only few members of the society could own a house of their own in Nigeria.

COOPERATIVE SOCIETIES: Is the voluntary organization of consumers into a society controlled as possible for the purpose of directly supplying their immediate needs by.

Definition above ; members of cooperative must join voluntarily i.e without any coercions and willingness, the cooperative favors the doctrine of equal right, benefits its opportunities for all vested in a management committee or board of director but in the general meeting of members.

HISTORICAL BACKGROUND OF COOPERATIVE SOCIETIES IN NIGERIA.

The history of cooperative movement in Nigeria dates back to the 1930’s.

The history of co-operative in Nigeria can not be traced without linking it the traditional co-operative as well as the legalized/formalized cooperative (Adeyeye, 1995).

Traditional cooperative of Nigeria were tailored to suit their own peculiar and immediate needs; the most prevalent of such institution is the credit organization known in English as the ‘Contribution Society’’ but which has diverse terms ‘Adashi’ by the ‘Esusu’ or ‘Ajo’ by the Yoruba and ‘Isusu’ by the Ibo.

In further discussing traditional cooperative, the activities of age groups clans, self groups in the country cannot be left untouched. Even in the west, from the stories told by our grandparent children used to work as groups on their parent farm when they are on holiday’s e.g to friends could take to work on their father’s farm. The legalized/formalized cooperation could be traced to 1890 when the British colonial administrator in the area of the colonial masters in India, commissioned Mr. Fredrick Nicholson to under study the rural credit cooperative system in Germany, the report was favorable and hence rural credit cooperative was introduced.

In 1933, a cooperative expert, Mr. C. F. Strickland was appointed to study and report on the desirability and possibility of establishing cooperative societies in what was then the colony and protectorates of Nigeria.

The modernization of cooperative in Nigeria dates back to 1934. In 1935, the Nigeria cooperative society ordinance was enacted the recommendation of Mr. C. F. Strickland which was fashioned out of the India cooperation society’s Act of 1912. The ordinance provided for:

i. Recognition of cooperative as a separate business enterprise.

ii. Prohibit the indiscriminate use of the title ‘cooperative’’.

iii. Appoint a registrar of cooperative to control and administer cooperative laws and fostering of cooperative development.

The Catholic Mission cooperative thrift and credit society Limited (CTCS Ltd) was registered in 1939 in Abeokuta under this law. (Bello 2004). Though cooperation had been with us since the beginning of time as we have seen in 1,2, & 3, the first formal attempt on record was that of Agege planters union which was established in 1907.

ROLES OF COOPERATIVE SOCIETIES IN FINANCING HOUSING DELIVERY IN NIGERIA.

The role of cooperative societies in financing housing delivery in Nigeria is stated below;

LOANS government may give loans cooperative societies to assist them in carrying out their ventures. In intensifying agricultural production. Loans may also be obtained from financial institutions like Nigeria Agricultural and Cooperative Bank (NACB), Federal Mortgage Banks of Nigeria (FMBN) and so on.

GRANTS may be received from the government but this is a very rare source of funds because government is more prepared to give loans which must be refunded.

DONATION at the stage of formation, some good spirited individuals, organizations my extend donation to the society. This is not regarded as conventional source of income to cooperative societies.

TYPES OF COOPERATIVE SOCIETIES IN NIGERIA MARKET RATE COOPERATIVE.

1. FULLY MUTUAL COOPERATIVE EQUITY COOPERATIVE

Which unit the returns allowed shares are sold. The amount of return is determined by a formula established in the corporation’s by-laws.

2. MUTUAL HOUSING ASSOCIATION.

Is a non-profit corporation’s setup and controlled by the residents of the housing project.

3. SUBSIZED COOPERATIVE.

Is a cooperative which has received some form subsidy form a government or non-profit entity to lower the cost of the housing to the tenant stockholder.

4. COMMUNITY HOUSING COOPERATIVES.

Which is an umbrella association of individual cooperative located within a neighborhood. They usually come together to support one another and have the ability to purchase or lease new buildings based on experience and membership.

5.SHORT LIFE COOPERATIVES.

Which are designed to accommodate the homeless for short periods they are usually collapsible structure a mobile homes situated on vacant plots owners by institutions.

THE OBJECTIVE AND ORGANIZATION OF HOUSING CO-OPEARTIVE:

The common objectives and priorities of housing co-operative are, to:

- Construct or obtain his houses at reasonable cost.

- Receive secure land tenure.

- Obtain clean water provision at a reasonable walking distance, and good roads.

- Live in a peaceful neighborhood with security against crime and through the provision of street lights, fencing locks

ADVANTAGES OF HOUSING CO-OPERATIVE.

· Advantage of housing cooperatives to members usually include personal involvement and satisfaction in providing one of the fundamental human needs, which is housing.

· Maintenance is likely to be more effective since this may be geared towards member’s priority areas and much of the maintenance activities can be carried out by members themselves, resulting in savings in terms of cost and manpower requirements.

· It is possible for tenants or members to benefit materially through the distribution of services arising from maintenance efficient management of buildings.

· Provide members with greater sense of neighborliness as against individual ownership development.

· It reduces the total amount devoted to direct construction of a given unit of housing accommodation, since bulk purchase of building materials at reasonable discounts is possible and often explored.

· Housing cooperatives serve as instruments for urban community integration and them often the necessary frameworks for the administration of housing and its general environment as well as other social and economic activities.

· Housing cooperatives help mobilize community skill and finances for housing delivery.

PROBLEMS OF HOUSING CO-OPERATIVE

1. Only few people have realized the potentials of self-help and housing cooperatives in housing delivery. People have not be adequately sensitized and mobilized to form cooperatives to meet their housing needs.

2. Problem of land acquisition for housing project development. The problem of land ranges from delay in title certificate of occupancy acquisition and plan approval, land speculation leading to high cost and litigation in case of multiple sale of the same land to different people to general inadequate access.

3. Members are not adequately knowledgeable in housing management and administration particularly on technical aspect of building and financial management, e.g. bookkeeping. This often led to poor project supervision, control and financial irregularity.

4. Low government support, recognition and inadequate operating environment.

5. Financial constraints and inability of the societies to secure loan or mobilize enough finances from members have been a constraint to the informal housing delivery system.

6. Lack of Members is another problem of cooperative. When there are no too much members it will go long way in affecting the operation of the society because the more the members the more the contribution.

7. Bankruptcy the society can easily go into bankruptcy because collateral is not required when giving out loans to members.

8. Financial security: if the society happens to go bankruptcy, the members will lose their initial contribution because there is no financial security.

RESEARCH DESIGN

The research design adopted for the purpose of achieving this research is close and open method whereby set of alternative responses is provided for every question and the responsedent is required to select a response that best approximate his opinion.

QUESTIONNAIRE ADDMINISTRATION

Twenty questionnaires were administered and designed in such a way that the respondents can easily apprehend its content and provide relevant answers to the question.

QUESTIONNAIRE DISTRIBUTION.

In order to gather relevant information needed to carry out this project work, went questionnaire were drafted to the users of different kinds of properties and their management.

COLLECTION OF RESPONSES.

The questionnaire administered to both the management and users of properties was completed and immediately given back to me by hand.

SAMPLE SIZE DETERMINEATION.

The sampling size was determined based on the nature of the population, purpose of survey, research design, and time limit for completion, cost and available fund.

METHODOLOGY

The methodologies observed in this study are work of both primary and secondary source

The primary source starts with a reconnaissance survey of various cooperative organization, then a sampling were employed in selecting the particular cooperative organization. Questionnaires were administered as well as interviews with the occupier/landlords, estate surveyors and valuers of Yaba College of Technology staff. While lecture notes, textbooks, journals, and seminar papers were used as the secondary source of data collection.

HISTORICAL BACKGROUND

YABA COLLEGE OF TECHNOLOGY STAFF COOPERATIVE SOCIETY.

The Yaba College of Technology staff cooperative society limited is a cooperative society set up by staff members of the College in the year 1976, with the aim of helping members of achieving their aims and realizing their dreams through the following ways:

i. To encourage saving among members by pulling resources together.

ii. To undertake real estate activities for the benefits of member.

iii. The procurement of household equipment such as TV, Laptop, Radio, and consumer goods etc subject to the availability of funds for members.

iv. The real estate is located at Agura/Gberigbe area and it is owned by their cooperative bodies.

DATA PRESENTATION AND ANALYSIS BASED ON RESEARCH OBJECTIVES.

Table 1.1: Gender of Response dent.

Variables	Frequency	Percent (%)
Male	13	54.0
Female	12	46.0
Total	25	100.0%