Columnists Features

National Housing Authority can do better


RECENTLY Minister of Housing and Infrastructure Development Ronald Chitotela said his ministry had secured K4 million from the Ministry of Finance to settle outstanding salaries and allowances at the National Housing Authority (NHA).

While it is commendable that Government has come to the aid of NHA to prevent it from total collapse, given its critical role in providing decent housing, sustainability of such help cannot be guaranteed considering many other competing needs in the country.
Government can render one-off help but cannot take over the financial obligations of the authority for one simple reason that it is not sustainable.
What makes it even more unsustainable and temporary is the fact that it is meant for consumption – that is to settle outstanding salaries and allowances for employees.
It is therefore only prudent that NHA rethinks its business strategies if it is to sustain its operations.
It is clear from the financial challenges NHA is facing that its business strategy is not working and therefore needs urgent re-examination, to prevent the authority from collapsing, thereby relegating its critical mandate of providing efficient, durable and affordable housing to the archives.
According to Habitat for Humanity, Zambia is currently grappling with a housing deficit of about 1.3 million, and if not addressed will reach three million by 2025.
This is because over the years, housing infrastructure development has not been proportionate to the rapid population growth rate of about 2.5 percent to 4 percent per annum. Currently the Zambian population is estimated around 15.5 million, according to the Central Statistical Office.
Urbanisation has compounded the problem further by putting pressure on the limited housing stock in the urban areas giving rise to slums.
This is because the high demand for limited housing stock, most of which is in private hands, has pushed the prices up, beyond the reach of many poor Zambians.
In 1971 the NHA was established by an Act of Parliament to make better provision for the development and control of housing throughout Zambia.
The NHA is divided in five main business units: consultancy, town planning, construction division, finance division and personnel and administration division. The main functions of the institution are: to advise the Government regarding the formulation and implementation of national policies on housing; to undertake, support and encourage research in all aspects of housing, with particular emphasis on low housing development; to provide consultancy services in all fields associated with housing development and to develop, manage and control housing estates.
Under the construction unit, NHA has come up with housing schemes where hundreds of houses  have been constructed for sale and renting out in Lusaka and on the Copperbelt.
Some of the projects include the Northgate Housing Complex off Kasangula road, Nyumba Yanga and Ibex Hill in Lusaka.
It is however saddening that most of these houses, which were built using borrowed funding, remain unsold and unoccupied due to the exorbitant pricing.
For instance, the housing units off Kasangula road were pegged at K375,000 before being hiked to K800,000 after inflation had taken its toll on the country’s economy.
Here, we are talking about two to three-bedroom houses with very tiny rooms costing that much.
Apart from that, the houses are built so close to one another that occupants can exchange handshakes from the windows – denying them any form of privacy.
The exorbitant price, the size of rooms and spacing in between these houses make them unaffordable and unattractive to most potential buyers.
How many Zambians can afford to buy a three-bedroom house at K800, 000?
Given an option to build a house, even a layperson would tell you they can build two big houses, if not more, depending on the size, from that amount. So what is the motivation to get those tiny houses from NHA.
And I thought NHA is trying to provide low cost housing to many Zambians who cannot afford decent housing. how can a house costing that much be defined as low cost.
NHA would have done well to conduct thorough research on its target market focusing on the income, buying power and preferences.
According to Zambia National Building Society, most Zambians are inclined towards building finance rather than house purchasing and that of its mortgage portfolio, 75 percent are building cases, 15 percent purchase, 10 percent renovation.
According to Centre for Affordable Housing Finance (CAHF), as at 2015 the average annual household income was only US$5,102. And  Zambia Institute for Policy Analysis and Research (ZIPAR) in 2015 estimated that low income households in urban areas could only afford a house costing between ZMK61,300 and ZMK100,000. This is way below what NHA has pegged its houses at.
While I sympathise with NHA that the cost of building is high, much more when using borrowed funds, it is very clear the Zambian housing market is tilted towards building finance because complete housing units are expensive and beyond reach, hence the need for the authority to rethink its strategy.
Instead of allowing the houses which have already been built to dilapidate, they should seek partnerships with organisations and even Government to rent them for staff and civil servants respectively.
They could also consider giving them out to civil servants on mortgage terms to be paid over a very long period of time, such as 20 years.
However, on the other hand, it is time for NHA to consider boosting its other business lines such as providing housing finance, consultancy on housing matters and supply of building materials.
They also need to build their profile as an authority in the area of housing by running successful ventures, failure to which they will not attract business opportunities.
It is commendable that Government has also committed to ensure that the authority is subcontracted for all infrastructure procurements in the country, whether private or public.
This will definitely go a long way in sustaining the authority considering the booming infrastructure industry.
NHA should also consider devising contracts attached to projects for most of its employees to avoid incurring high overhead costs in instances where there are no running projects.
The author is Zambia Daily Mail editorials editor.


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