FG proposes escrow for off‑plan home sales, but warns verification gap remains
The Federal Government has announced a National Housing and Built Environment Regulation Policy that would require developers to obtain a licence before selling homes off‑plan and to hold buyers’ payments in regulated escrow accounts, releasing funds only when agreed construction milestones are reached. Housing Minister Engr. Muttaqha Rabe Darma presented the policy as a genuine step forward to protect buyers who have lost money on projects that were never completed.
While the escrow mechanism protects where money sits, the policy does not yet say who verifies that a milestone has actually been met. Without independent verification, funds could be released based on a developer’s own report, moving risk from the bank account to the paperwork. Experts note that markets such as Dubai, India and Malaysia pair escrow with independent verification—licensed engineers, architects or accountants certify progress, and records are kept in tamper‑proof logs.
To close the gap, the policy should licence independent verifiers, tie escrow releases to their certified reports, and preserve a durable audit trail accessible to buyers, regulators and courts. Getting verification right would not only protect homebuyers but also create the trust needed for pension funds, insurers and development finance institutions to channel the ₦31.48 trillion pension assets into housing, unlocking supply at scale. Stakeholders are urged to respond to the ongoing consultation with concrete suggestions on verification standards and record‑keeping.