Built environment experts have expressed fresh concerns about the rising cost of building materials, saying the situation portends danger for the sector, the economy and average Nigerians in need of accommodation.

Speaking with the Nigerian Tribune, the housing experts, comprising the chapter president, FIABCI Nigeria (the International Real Estate Federation), Akin Opatola; Managing Director, Fame Oyster Nigeria Ltd., Femi Oyedele; Managing Director, Nuel Osilama Global, Osilama Emmanuel Osilama; and former President, Africa Real Estate Federation, Mr. Chudi Ubosi, raised the alarm over the prohibitive cost of cement and iron rods.

They pointed out that more Nigerians will be homeless due to the cost of building materials, leading to a high housing delivery’s cost.

Currently, in Nigeria’s building materials market, a 50-kilogramme bag of cement costs N12,500, while the market price for reinforcement steel bar known as iron rods is between N800, 000 and N1. 4 million, depending on the brand.

While the minimum wage in remains N70, 000, the fear among industry stakeholders is that many Nigerians won’t be able to own a home due to low incomes and high building cost.

Also, the average cost of one and two bedrooms has risen above N10 million in most cities, with rental values climbing between N400, 000 and N1million per annum.

Decrying the situation, Oyedele urged governments at all levels to promote alternative building materials that will reduce the consumption and dependence on cement in building construction.

He said: “The solution is for the government to promote alternative building materials that will reduce the consumption of and dependence on cement in building construction.”

Describing the situation, where cement manufacturers are raking in more revenues,  while cement cost remains high, Oyedele said: “The only way we can describe the situation is that it is shambolic.

“The essence of having research institutions like the Faculty of Environmental Sciences in our tertiary institutions and Nigerian Building and Road Research Institute (NBRRI) is to forestall situations like this.

 “Manufacturers cannot be making so much profit from the people on essential commodities like cement which is necessary for provision of a basic need like housing and the governments will fold their arms without finding solutions to address the situation.“

To address the situation, Oyedele urged the governments to lead in the adoption of alternative building materials that will reduce the consumption of cement in their building construction.

He justified the excessive demand of cement, saying it is partly due to the adoption of concrete as a road material by the Federal Government, starting from 2023, and the demand for cement for housing by the masses and the three tiers of government.

“In Germany, the UK, the USA and Canada, the volumes of cement used for construction of houses are less than 50 percent of the volumes we use in Nigeria. We must reduce our dependence on cement in building construction if we want the price of cement to come down,” he said.

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From the perspective of the real estate and housing sector, Opatola, on his part, said the rising price of major building materials like cement and iron rods is deeply concerning.

Opatola described cement as one of the most important inputs in construction, pointing out that sustained increases in its price have a direct multiplier effect on the cost of building houses.

He said: “When cement becomes more expensive, the developer’s construction cost rises; this ultimately feeds into the price of completed homes, rents and even land values in some locations.

“For the average Nigerian, this means that home ownership is becoming increasingly difficult, particularly for low- and middle-income earners.”

“It also undermines the government’s efforts to address Nigeria’s housing deficit because even when land is made available, the cost of actually developing the housing remains prohibitive,” he added.

He also spoke on the wider economic implications angle, saying, “If the cost of construction continues to rise faster than household incomes, we could see a further widening of the gap between the supply of affordable housing and effective demand.”

Similarly, Osilama said : “Cement is not a luxury. It is one of the basic things we need to build houses, roads, schools, hospitals and other infrastructure.

Osilama said when a bag of cement becomes expensive, the effect is felt everywhere, noting that the cost of building, house prices and rent would go up.

“Developers like me struggle, and more Nigerians are pushed further away from owning a home. So, I think stakeholders need to have an honest conversation about this,” he said.

He said the government and the industry would need to look at issue of high building materials’ cost seriously.

He said: “We need more transparency, stronger competition (allow others in the manufacturing arm) lower production and logistics costs, and policies that can help bring the cost of building down.

“Because we cannot keep talking about affordable housing when the basic materials required to build those houses are becoming unaffordable.”

“This is not about attacking cement manufacturers. They are in business to make profit. But we also have to ask, at what point does the cost of doing business become a burden on the people and the economy?

Chudi Ubosi blamed high multiple taxes being levied on companies by the governments and their agencies for high cost of manufacturing in the country.

He stated that in his company, he pays more than 43 different taxes and fees annually to the government.

To recover from this, he said the consumers would have to bear the costs as they are being spread on the products.

Recall that Nigerian Minister of Works, David Umahi, recently called on cement manufacturers nationwide to immediately lower the price of the product.

He warned that high market costs place heavy pressure on public infrastructure projects and drive up demands from contractors for costly contract price reviews

He raised the alarm that high cement prices cause road and housing contractors to push the government for contract variations.

 Umahi stated that the government will reject requests to review existing contract costs upward, putting the onus back on producers to lower production expenses.

The call, he said have become imperative following the massive federal investments in roads and housing.

The Federal Government initiated formal stakeholder meetings and discussions with major producers (including Dangote, BUA, and HBM/Lafarge) to find lasting pricing solution. Outcomes of these deliberations are yet to be seen by Nigerians.