The Federal Mortgage Bank of Nigeria is teaming up with a number of housing developers to finance the construction of more than 10,000 homes a year across the country.
The aim is to build up a fund of $2bn and disburse $200m a year in loans to developers.
A memorandum of understanding was signed last week in Abuja by Richard Esin, the managing director of the bank, James Mugeruwa, managing director of international affordable housing developer Shelter Afrique and Ugo Chime, president of the Real Estate Developers Association of Nigeria.
The drive to improve the supply of homes was begun at the "Developing a Blueprint for Affordable Housing" conference organised last June by the Federal Ministry of Power, Works and Housing, housing developers and the German Development Corporation (pictured).
The move is a response to a deficit of about 17 million homes across Nigeria. The situation is particularly serious in Lagos, which has an immigration rate of more than 500,000 people a year.
The housing shortage is exacerbated by high rental prices, and the fact that landlords often demand a year’s rent in advance.
Mr Esin said after the signing: "We needed to bring in Shelter Afrique to work in partnership with the Real Estate Developers Association of Nigeria to make available some funds over the next 10 years to give impetus to the national housing model by providing the other members with the necessary construction finance that would be required to drive the national housing model."
Mr Mugeruwa said the housebuilding programme would have a number of secondary benefits such as "job creation for women and youths, environmental friendly housing and energy efficiency".
Mr Chime added that the aim was to create a "seamless interface" between construction finance and mortgage creation. He said: "When we reduce the timeline involved in some of these issues, it reduces the cost because one of the biggest costs is cost of the funds employed".
Image: Speakers at the 2016 affordable housing summit in Abuja (Federal Mortgage Bank)
This article was edited on 25 January to make it clear that 10,000 homes are planned each year.