Vacant houses: Stakeholders fault planned tax imposition


Stakeholders in the housing sector have asked the Federal Government to ignore proposal by the visiting UN Rapperteur, urging it to impose taxes on all vacant houses in major cities across the country.

According to them, the basis for such proposal is faulty and amount to double losses to owners, while making  life difficult for accommodation seeking residents, who would be made  to  pay more rents.

The United Nations Special Rapporteur on Rights to Adequate Housing, Ms Leilani Farha, who was on a 10-day fact finding visit to Lagos  Abuja, Port Harcourt and Kano had decried the housing crises in Nigeria.

In her submission, she urged  government to  develop appropriate strategies to deal with the situation, describing  most of the unoccupied houses or estates as “proceeds of money laundering and other illicit funds.”

To curb corruption, money laundering and raise more funds to build houses for ordinary Nigerian’s, she suggested that the Federal Government should impose taxes on the vacant homes across the country.

Reacting in a chat with Newsfieldglobal, Lagos-based estate surveyor and valuer, Mr. Stephen Jagun, said it  was wrong to categorise all vacant houses as proceeds of corruption.

According to him, not all vacant houses are products of stealing.

“it is wrong for anyone to assume that all vacant or unoccupied houses are products of corruption,” he said.

Jagun, who is the Principal Partner, Stephen Jagun and Associates, said: “There is no need to leave the main issue and start pursuing  shadows,” adding that the pertinent  question should center on why the houses are emptied.

Jagun  blamed underdeveloped mortgage system in the country for the vacant houses, saying this deprived accommodation seekers  the opportunity  to access the houses.

To correct the anomaly,  he urged government to  fix the economy, provide employment, while  revisiting the nation’s mortgage system.

According to him,  if  government imposes taxes on vacant houses,  the poor would suffer more as they would be made to pay more rents  for accommodation.

Jagun maintained that these houses were vacant due to bad economy, pointing out that as a result, many potential tenants, who could have afforded the rent lost their jobs.

Besides,  he said  many people built the houses to store value, while others built for investment purposes.

“Many owners of these houses  did not borrow to build so they are not in a hurry  to reduce rent. There is no obligation to pay loans,” he said.

Another professional estate surveyor, Mr. Richard Olodu, stated that  taxing vacant properties would amount to double punishment for property developers, who  borrowed money to develop the property.

He said: “They have to pay both interest and capital to the bank without any income yet from the development. Taxes are payable on income.

“Why will you tax a property owner for being unable to secure tenants for his property, which is not his fault but due to economic downturn?”

Imposition of tax, he said, could discourage people from investment in property which has wider implications for the economy.

It has been  estimated that over 5,000 properties in Lagos are unoccupied due to over-pricing and high agency fee.

In Abuja, the number of completed and vacant houses are over 30,000, notwithstanding the high number of slum settlements dotting the city.

The Nigerian government has to develop appropriate strategies to deal with the situation because most of the unoccupied houses or estates are proceeds of money laundering and other illicit funds.

Lecturer in the Department of Urban and Regional Planning, University of Lagos, Professor Leke Oduwaye, said the UN Rapperteur was  ignorant about land tenure and property development financing system in Nigeria.

“Our case is such  that in which the govt in actual practice failed to support individual efforts in housing development,” he said.

The university lecturer explained that  people using their financial resources to develop housing took those personal decisions among other investment choices.

“It’s just ignorance of the issues involved in the case of investment choices in Nigeria,” he said.

Secretary,  Intellectual Property Valuation, Nigeria Institution of Estate Surveyors and Values, Mr. Lekan Akinwunmi, said that imposition of tax on vacant houses  would  enable people to count their cost  before embarking construction.

“it would  allow us to know true owners,” adding that govt would need  to generate revenue  to protect  vacant  buildings.



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