CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
Nigeria is the most populous country in Africa and 8th in the world, with a population of 173 million. Over the past decade the economy has been growing at an average rate of around seven percent yearly and, after Johannesburg, Lagos has the biggest, most liquid market in the region thereby creating the need for massive housing development. A central bank, reserve bank, or monetary authority is a public institution that usually issues the currency, regulates the money supply, and controls the interest rates in a country. Central banks often also oversee the commercial banking system of their respective countries. In contrast to a commercial bank, a central bank possesses a monopoly on printing the national currency, which usually serves as the nation’s legal tender (Arthur and Sullivan, 2003). Example is the Central Bank of Nigeria (CBN). The various roles of CBN will however in no doubt have specific impact on housing delivery in Nigeria.
According to Wikipedia.org, Central banks around the world play similar functions some of which may include- implementing monetary policies, determining Interest rates, controlling the nation’s entire money supply, the Government’s banker and the bankers’ bank (“lender of last resort”), regulating and supervising the banking industry, setting the official interest rate – used to manage both inflation and the country’s exchange rate– and ensuring that this rate takes effect via a variety of policy mechanisms and managing the country’s foreign exchange and gold reserves and the Government’s stock register.
Shelter is one of the basic necessities of life. Indeed, the housing sector plays a very critical role in a country’s prosperity as it directly affects not only the wellbeing of the citizenry but also the general performance of other sectors of the economy. Thus, provision of housing has, since the early 1970‟s, engaged the attention of most countries, especially the developing ones, for a number of reasons. First, it is one of the three most important basic needs of mankind. Consequently, programmes of assistance in the areas of finance, provision of infrastructure and research have been designed by governments to enhance adequate housing delivery. The focus on finance has, however, been very prominent for the reason that, housing provision requires huge capital outlay, which is often beyond the capacity of most of the citizens (Akeju, 2007).