ASSESSMENT OF THE IMPACT OF URBAN INFRASTRUCTURE ON RENTAL VALUE OF RESIDENTIAL PROPERTIES

ASSESSMENT OF THE IMPACT OF URBAN INFRASTRUCTURE ON RENTAL VALUE OF RESIDENTIAL PROPERTIES

ABSTRACT

Property value is dependent upon many characteristics associated with that property such as physical characteristics of property; location of the site in relation to employment centers and other urban infrastructure. In addition the social and economic characteristics of neighborhood, including the presence of such amenities as view, parks, schools and community services affect value. Those attributes are usually provided by the State and Local governments through their various policies and services.  Thus this project is aimed at assessing the impact of urban infrastructure on rental value of residential properties. The researcher adopted the use questionnaire to collect data from the research population which consists of tenants, landlords, property developers and real estate firms that resides in Nasarawa town. The use of tables, percentages and descriptive statistical tools were used to analyzed the data. The results of analysis indicates that the availability of urban infrastructure positively affect the rental value of residential property this is shown clearly in the rental values of properties located in rural areas where there are no infrastructures and those found in urban areas where infrastructures such as electricity, portable water, medical centers etc are found.

CHAPTER ONE

1.0       INTRODUCTION

1.1       BACKGROUND OF THE STUDY

Nigeria with 5.3 percent growth rate has a population of 140 million and it is one of the countries with the fastest rate of  urbanization in the world . One of the greatest challenges of successive governments in Nigeria had been the need to provide adequate housing to its teeming population. Submissions on appraisals of different housing programmes over the years revealed that no significant positive effects had been achieved.

Findings from recent studies of urban problems in Nigerian cities have revealed that a significant proportion up to 34 percent (in some cities) of the houses had no access to electricity, pipe-borne water, decent safe waste disposal systems and un-connected by motorable roads.

Unfortunately, the level of deficiencies and the degree of deterioration of infrastructure in Nigerian urban centres is becoming more alarming and worrisome due to the inability of the public sector to meet up its social responsibilities to the people.

The problems of deteriorated infrastructure are particularly pronounced in the old, indigenous core areas of the cities while the non-availability of infrastructure is peculiar to the outer spontaneous settlements that accommodate the low-income population. This led to the prevalence of a generally unwholesome and unhygienic environment in most Nigerian cities that pose a greater danger to the health of the inhabitants.

In addition to its health implication, Olanrewaju (2000)  has earlier qualified areas in cities with deteriorated infrastructure as poor areas that are characterized by spatial concentration of low-income population, which are possible sources of urban crimes and violence.

The effects of infrastructural deterioration and their non-availability on the quality of lives notwithstanding; Floyd and Allen (1998)  have reiterated their importance in the local development process. Thus, concluding that infrastructure development or the lack of it is often used as a policy tool to encourage or discourage growth. However, this study focuses on the analysis of the effects of infrastructure on property development. It is an attempt to determine the influence of infrastructural provision on the rent al value of residential properties based on the underlying view that improved infrastructural facilities would enhance the rent al value of residential

1.2       STATEMENT OF THE PROBLEM

The needs and important of urban infrastructural cannot be underestimated since investment in infrastructure is well connected to all factors of economic development. This always includes an increase always offset by increasing opportunities and income to the general vicinity. The closer a residential area, is to new infrastructural projects, the higher the increase in its value. However, the reverse relationship is also true as failing in infrastructural investment is closely related to hold that, decaying or neglecting infrastructure is a major determent of economic decay and recession.

The problem therefore is that, this important and significant relationship between urban infrastructures and property value has not being properly identified thereby resulting in neglect in terms of infrastructural investment especially in the study area.

 1.3       AIM AND OBJECTIVES

The aim of this study is to assess the impact of urban infrastructure on rental value of residential property in Nasarawa, Nasarawa State. In order to achieve this aim, the following objectives are critically pursued:

1. To identify the types of residential properties
2. To identify the types of infrastructure available in the study area.
3. To access the adequacy of the infrastructure
4. To analyse the relationship between infrastructural facilities and property value.
5. To appraise the problems of residential properties in Nasarawa
6. To make appropriate recommendation on the way forward.

 1.4       RESEARCH QUESTION

            Below are research question derive from the objective listed above.

1. What are the types of urban infrastructure in the study area?
2. What is the adequacy of urban infrastructure in the study area?
3. What are the relationship between urban infrastructural facilities and property value?
4. What the problems associated with urban infrastructural facilities and residential property in Nasarawa?

1.5       JUSTIFICATION OF THE STUDY

Similar studies in the past have revealed the poor state of our urban infrastructure and its consequential effect on property value with much emphasis on the relationship that exist between infrastructure and property value. However the income generation capacity of infrastructural provision to the public authorities through high rental values, rates and taxes has been neglected. This study is therefore necessary to assist public authorities in putting more efforts in infrastructural investment and as well take full advantage of the income that can be generated from such investment.

1.6       SCOPE AND LIMITATION OF THE STUDY

The research work is confined to the study of the Impact of urban infrastructural facilities on residential rental problem in Nasarawa. It deals with rental value of residential properties such as single room, two bedroom flats and three bedroom flats which are the common types of residential properties found in the study area. The work activities however, will cover the provision of road network within a period of 2010-2021.

1.7      OPERATIONAL DEFINITION OF TERMS

Residential Properties: Oxford advanced learners dictionary defined residential properties as properties suitable for living in, consisting of houses rather than factories, or offices.

Property: Property is by property dictionary as anything that is owned by a person or entity, which be divided into “real property” and personal property.

Infrastructure: This is seen as a wide range of economic and social facilities crucial to creating an enabling environment for economic growth and enhances the quality of life, Nubi (2002).

Value: Value is basically the worth of a thing which depend largely on the basis of assessment and unit of measurement.

Property Value: property value according too Millington (1981) is the money obtainable from a person willing and able to purchase property when it is offered for sale by a willing seller, allowing for reasonable time for negotiation and with the full knowledge of the nature and uses which  the property is capable of being put.

 1.8      HISTORICAL BACKGROUND OF THE STUDY

Nasarawa Local Government area of Nasarawa state was established in 1976 during the military regime under the leadership of general Mohammed Administration, the local government have thirteen 13 wards and it consist of six department which is responsible for carried out the activities personal social primary health care agriculture and natural resources. The state derived its name from the local government Nasarawa. The local head quarter is between latitude 7.8 degree east by Karu.

The also shared boundary with Benue state, Toto Local government area and federal capital territory, the local government have a population 187220 by the 2006 census through contest in the law court it has multi ethnic Afo, Agatu, Gwandara etc.

 THE PEOPLE AND THEIR OCCUPATION

The major ethnics groups are Hausa, Afo, Gwari, and Gwandara. The earliest inhabitants were predominantly farmers and some of them are fishermen they use river for their routine fishing.

Besides, they were also engaged in rearing of cattle, black dying and weaving. Meanwhile, trading is one of their major occupation as a result of the establishment of the Federal Polytechnic.

TOPOGRAPHY

From an elevation of about 1,500 to 1,000 meters, the Nasarawa descends in a series of step to the wide Benue through the northern part of the low lands forms a continuous plain about 50 kilometers wide which gradually slopes from the foot of the Nasarawa towards river benue. The western part of the northern low land is an area of transaction, only part of it can be regarded as belonging to the Benue plains.