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The effect of the Land Use Act on Real Estate in Nigeria

The current Land Use Act which is made up of eight parts of fifty-one sections have been enshrined in the constitution of the Federal Republic of Nigeria.

The Act which was enacted in March 1978 during former President Olusegun Obasanjo military era empowered State governors to control and manage all lands in urban areas while the local government was also mandated to control and manage all lands within their  area of jurisdiction according to Part 1, Section 2 (a, b) of the act.

This section however created a lacuna between the government and community through the transfer of land ownership to the government instead of community via the Land Use Act, an opportunity that have been terribly abused by the state governors.

The lacuna which consistently manifested in the Niger Delta Region led to endless disputes in the oil producing communities between the federal government and locals who had questioned the eligibility of the government to own greater part of proceeds from oil sales.

Due to these exclusive rights of the government, the sales of community lands are done at will with little or no compensation for the indigenous community as currently witnessed in the Federal Capital Territory.

The acquisition of land by individuals and corporate bodies for commercial and residential purposes remained a bottleneck till date due to the existence of the Act even as two or more individuals have been allocated a parcel of land especially in the FCT at the expense of gullible victims.

This however led to concerted calls by stakeholders in the built industry for urgent review of the Act in the interest of private investment.

In a chat with LEADERSHIP, the President of Nigeria Society of Engineers (NSE), Engr. Otis Oliver Anyaeji advocated the scrapping of land use act to facilitate land acquisition and ownership.

He suggested that a land law that would be private sector driven should be enacted saying that the current land use act have turned state governments as biggest businessmen in the country.

“This is because, the land that would have been in the hands of private people was left in the hands of government but since Land is capital intensive and it’s in the hands of the government; the laws ought to be changed.

According to him, “For instance, the very bad effect of that law is that government has overriding claim over the oil, minerals and other natural resources thereby receiving all the royalties and profit sharing that should have gone to private investors.

He expressed regret that owners of such lands had been completely marginalized adding that state governments are confused on how to spend proceeds from the sale of such lands.

“Since the inception of the present administration, they have exposed how the monies collected have been misused, so it’s important that the law is changed so that if an individual owns a land, he or she will know that the land either belongs to himself or the community and the person should be part of the business development profit that will come out from the land.

Also, the Executive Chairman of Bauhausv International limited, Dr. Victor Onukwugha described obsolete Land Use Act as major challenges hindering effective mortgage financing and land acquisition in Nigeria.

Onukwugha who is also a Real Estate Developer enjoined the Federal government to review the Land Use Act, foreclosure law and titling processes for increased private sector participation.

“Once the Land Use Act is reviewed, it will create good funding for construction and mortgage loan and this has to be addressed through real estate and private developers partnering with the government on the provision of affordable housing.

He advised the federal government to concentrate on a social housing programme targeted at low income earners stressing that real estate developers should be given opportunity to provide affordable housing to medium and upper income earners.

Onukwugha noted that the review would address the problem of funding hindering the provision of affordable housing adding that it would lure international financing institutions to Nigeria mortgage system thereby making provision of housing less cumbersome.

However, the President of Shelter Rights Initiative, a non-governmental organisation, Barr. Festus Adebayo called on National Assembly to review laws that are impeding against successful housing delivery in Nigeria like Land Use Act and FMBN Act among others stressing that NASS should embark on Constituency projects in the area of housing.

Adebayo who is also the Chief Executive Officer of FESADEB Communication enjoined State governments to remove the bottlenecks associated with land acquisition even as he pleaded with stakeholders to join forces in order to create a vibrant ministry that would focus on the housing needs of Nigerians.

“Most mortgage banks take loans from commercial bank and that is why they cannot finance mortgage because it is impossible to use short term finance for long term projects in construction.

The Former Minister of sports, Hon Bala Kaoje however expressed divergent views on the land use act adding that he had acquired lands easily from state governors.

“Many people have been shouting about Land Use act being a clog to housing provision in Nigeria but I don’t believe in that because I have lands in a number of States given to me by the State government and I don’t think I have spent more than 3 months before getting the land with the certificate of occupancy signed by the governors.

Kaoje who is a director with Bohemian Estate Limited said land acquisition is embedded on 3 three determinants such as dexterity, interest and package.

Source: Leadership

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