As Nigeria steps into 2026, millions of citizens continue to grapple with a housing reality that feels increasingly unattainable. For most working Nigerians, the dream of owning a home remains just that—a dream.
The country’s housing crisis is not merely about bricks and mortar; it is a complex web of locked pension savings, expensive credit, and policies that fail to reflect how ordinary people live, work, and build.
Across the nation, formally employed Nigerians diligently contribute to pension accounts, often over decades.
Their aspiration is modest: to save enough to construct or purchase a small home. Yet these long-term savings remain largely untouchable until retirement. When workers attempt to access credit as an alternative, they encounter interest rates so high that borrowing becomes financially destructive rather than empowering.
Short-term, high-cost loans clash with the incremental approach most families must take to build a house, leaving projects half-finished or abandoned.
Microfinance loans, advertised at seemingly modest rates, compound into crushing burdens over time. Borrowers face effective interest rates nearing 93 percent over two years, excluding administrative fees.
A small business or a family attempting to build a home sees profits or savings consumed before the project even starts. Housing insecurity, reduced enterprise growth, and rising unemployment ripple through communities, creating social pressures that policymakers can no longer ignore.
The mortgage system in Nigeria compounds these difficulties. Many Nigerians build gradually, stage by stage, yet the Federal Mortgage Bank of Nigeria primarily finances completed homes, which remain prohibitively expensive.
Pension contributions, which could serve as equity, are tied up in bureaucratic processes that few can navigate. As a result, long-term savings remain inaccessible precisely when they are most needed.
Structural issues worsen the picture. The Central Bank of Nigeria’s high Monetary Policy Rate, currently around 27 percent, keeps borrowing costs elevated.
While intended to curb inflation, this policy inadvertently blocks access to long-term, affordable credit for housing. Inflation itself stems less from monetary policy than from structural inefficiencies: insecurity, import dependence, and weak local production.
Without addressing these underlying factors, high interest rates merely reinforce the housing gap.
Other countries demonstrate feasible solutions. In the United States, households access 15- to 30-year mortgages at stable rates, with retirement accounts sometimes backing housing loans. South Africa uses pension-backed guarantees to reduce lender risk and lower interest rates.
The United Kingdom combines fixed-rate mortgages with targeted savings schemes for first-time buyers. In each case, long-term savings are mobilized effectively without compromising financial security.
For Nigeria, the way forward requires connecting long-term savings with long-term housing needs. This means simplifying the pension-to-mortgage framework, creating deeper pools of long-term credit, and ensuring transparency in lending.
By offering patient capital through development finance institutions, mortgage banks, and regulated refinancing, Nigerians could borrow at sustainable rates, while the Central Bank maintains control over short-term liquidity and inflation. Incremental housing schemes, serviced plots, and well-structured public-private partnerships must form the backbone of policy, aligning government strategy with how citizens actually live and build.
As the new year begins, the stakes are clear. Half-finished homes, families struggling to balance rent with school fees, and workers unable to leverage their savings illustrate the human cost of policy gaps. Housing should not be a privilege reserved for the few; it should reflect the promise of work, contribution, and citizenship.
Nigeria has a choice: to continue a system that quietly excludes the majority, or to embrace reforms that allow ordinary citizens to save, borrow, and build with confidence.
The housing crisis is not inevitable.
With deliberate reforms linking pensions to housing, expanding affordable long-term credit, and aligning policy with real-life practices, Nigeria can begin to turn aspiration into access, ensuring that homeownership is within reach for all who work and save in the country.
