Experts in the housing /real estate sector have kicked against the practice of land racketeering in their sector.
This practice, they said has discouraged investments in the real estate sector.
One of the experts, Mr Femi Oyewole, who is also an estate surveyor and valuer, said land racketeering hurt real estate investment in the sense that it gives room for illegal hoarding of land by public officers.
He defined land racketeering as “the illegal purchase of land by those in authority with the primary aim of selling to the end-users and making profit.”
According to him, everybody in the position of power and authority who used their power and authority to get land allocation is responsible for land racketeering.
“Land racketeering is worse than Omoonile syndrome in that Omoonile does not include hoarding of land. The only advantage is land racketeering does not sell illegal land like Omoonile.
“While land speculation is a business, land racketeering is a fraud. Land speculation is buying of land by qualified people with the intention of selling at higher prices in the future,” the expert said.
On the danger of land racketeering, Oyewole explained that the practice hurts investment in real estate in such a way that public officers who were not authorised or private companies which were not to trade in land, are the ones trading and making profit.
“Investors are risk takers and risk their money to invest,” he said.
He also suggested ways to curb land racketeering in the system, calling for the adoption of rule of law, effective land management and administration.
He said “Effective use of Property Identification Number (PIN) to document land holding of all Nigerians; effective property tax and land-based taxes and high capital gain tax which will make buyers of land who are not the end-users to be taxed heavily including sales holiday on land, that is, buyers of land can be mandated not to sell for five or six years.
“There are many ways to curb land racketeering if the government is serious. But government officials are the most culpable.”
“129 fake companies were discovered in 2021 in FCT alone, 60 percent of which belonged to public officers. Most of these officers were in charge of land allocation.
“If government invites professional land managers and administrators and implement the National Land Commission which is being set up as a synergy between World Bank and Federal Ministry of Housing and Urban Development, land racketeering will be a forgone issue as Land Use Act 1978 will be implemented to the letter,” Oyewole said.
Meanwhile, the Executive Director, Housing Development Advocacy Network (HDAN), Mr. Festus Adebayo, has warned against land racketeering in the Federal Capital Territory (FCT), Abuja.
According to him, the practice is putting huge investments by real estate developers at risk.
Adebayo, who spoke with journalists, called on the FCT Minister, Nyesom Wike, to declare a state of emergency on land in the territory.
“The master plan of the FCT is in disarray; it requires surgical operation, and the FCT minister must declare a state of emergency on the FCT urban planning system. So much damage has been done. The system is no more going in line with those who saw the vision of the FCT and gave the master plan.
“Firstly, the number one problem with the planning of FCT is that there is no detailed information on existing approved layouts – resulting in fake layouts overlapping it.
“This information, if it is made public, can enable investors to know the right information that will save them from falling victim to land racketeers, ” he said.
Adebayo alleged that staff of the Federal Capital Territory Administration (FCTA) and Federal Capital Development Authority (FCDA) were colluding with the racketeers to destroy the master plan and also fleece developers.
“Today, 70 percent of cases in courts in the FCT are land related, which is why the real estate sector in the nation’s capital is at risk.
“We are calling on the government of the FCT to look into the areas where the planning system of the FCT has been abused,” he added.
He also called on the ministry to be wary of politicians who are desperately looking for land to grab.
“We must not put the real estate sector in FCT in danger,” he warned.
Meanwhile, the Director, FCT Development Control Department, Mukhtar Usman Galadima, in a separate interview, warned that those that opt to circumvent the development process would have their buildings removed while stiffer penalties would be applied like imprisonment to deter people from violating the process.
“Also, for any staff found to be involved in any scam, the civil service rules would apply, and this may lead to dismissal because some illegalities arise from compromise from within and we don’t compromise,” he said.
Galadima explained that the process of building in Abuja starts with obtaining valid title documents, and urged developers to go to the Development Control Department whenever they are ready to commence construction.
He said the department is currently in the process of simplifying the process of acquiring building approvals in such a way that all lands based on their districts would be put on its website, indicating the type of development required.
He said, “For commercial development, there are certain required documents, e.g. environmental impact assessment report, and if it is going for more than two suspended floors, there has to be a soil investigation report to tell us the type of soil and whether it has the carrying capacity and even the type of foundation that you’re going to have.
“When all this is done, there are teams that will visit the site and compare the documents and reports you submitted.
“Once we’re satisfied with these, we now look at the drawings viz-a-viz our requirements in the manual and compute what you are expected to pay to the government – the building plan processing fee – and when you pay that, we stamp your drawing and convey approval to you.”
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