Municipality to Take Out Loan for Local Housing Strategy
The Lagos City Council has put forward a proposal to take out a loan to finance part of the €47.5 million investment in the construction of affordable housing.
This initiative is part of the Local Housing Strategy (ELH), approved in 2021, which outlines the construction of 267 controlled-cost municipal housing units under the “1.º Direito” program and the rehabilitation of the municipal housing stock, representing a total investment of €48,103,458.11. To support this strategy, the municipality and the IHRU (Institute for Housing and Urban Rehabilitation) signed a Collaboration Agreement in 2021 (revised and amended in 2024), under which the State committed to financing €34 million, including €15 million in non-repayable funds and €19 million through a subsidized loan.
However, to date, the municipality has not yet received approval for the investments under its application for full financing from the “Housing Access Support Program“ of the PRR – Recovery and Resilience Plan. As a result, projects and construction work have so far been entirely funded by the municipal budget, leading to the need to seek alternative funding sources.
Since the municipality has borrowing capacity, the City Council has decided to secure bank financing, moving forward with a proposal for a medium- to long-term loan of €25 million, to be used over the next three years for the construction of housing units planned under the Local Housing Strategy.
The proposal, approved in a City Council meeting, was subsequently discussed and approved by the Lagos Municipal Assembly.
