AN EVALUATION OF THE IMPACT OF DEVELOPMENT CONTROL ON RESIDENTIAL PROPERTY IN PORT HARCOURT METROPOLIS

AN EVALUATION OF THE IMPACT OF DEVELOPMENT CONTROL ON RESIDENTIAL PROPERTY IN PORT HARCOURT METROPOLIS

ABSTRACT

This project isan evaluation of the impact of development control on residential property value in Port Harcourt metropolis. In the course of carrying out this research the primary data was collected through questionnaire and oral interview with the Rivers State Development Authority and some real estate property developer in the study area. 100 Questionnaire was administered which 80 was collected back upon which the data presentation and analysis depends on. The instrument used in analyzing the data was purposive and tabular form. The research shows that developer and the development control officials tend to accused each other of complicity in development of residential property process in Abuja. the researcher therefore recommend that there is urgent need for effective force and good communication skill and rapid awareness aiming at creating adequate effectiveness on physical environmental issues in Port Harcourt metropolis.

CHAPTER ONE

1.0       INTRODUCTION

1.1       BACKGROUND OF THE STUDY

Property development control forms an integral part of the planning practice. It is the basic means by which the state intervenes to regulate the use and development of land in order to implement local and national planning policies. Most significantly it is the part of the planning process in which members of the public come into contact with local planning authorities.

Today, property development control comes under considerable criticism about the nature of decisions taken, and the ways in which they are taken. One hears complaints that sluggishness discourages development; that its complexity is excessively costly; And that its nature stifles initiative. (Amos, 1980). Development control is not appreciated by the general public mainly because of the restrictions it imposes on the aims and aspiration of the developers.

Originally, the rationale for the introduction of state control on private development was to achieve objectives of safety and better health in order to create an improved environment for the benefit of the community. However, as the role of the state expanded and the extent of its intervention increased the definition of the ‘environment’ subject to planning control has changed. From being wholly concerned with the physical form and content of development it now embraces the social and economic consequences of development. As a result, development control has been used to implement planning strategies for different purposes; for example to minimize the negative effect of urban growth, to check the menace of market forces and ensure social equity, as well as to support economic growth (Litchfield & Darin Drabkin, 1980).

Therefore, property development control is a tool, sometimes used to achieve its original objectives of safety and better health; Sometimes to implement planning strategies; and in some cases to do both. Although it continues to regulate the use of land, while planning strategies have widened in scope, development control has proved incapable of meeting additional demands. Since development control is used to implement planning policies, which are normally reflected in planning legislation, physical development plans and other associated planning documents, the failure to achieve development planning objectives may be due to the pursuit of inappropriate policies, to the application of inflexible standards and regulations, or both, which is why Koenigsberger (1975), Rivkin (1978) and McAuslan (1985) comment that development control practices are inappropriate, ineffective and inequitable in their operation in most Third World cities.

They argue that developing countries stand to benefit little from the transplanting of regulations that have evolved in different social soils with differing political and economic climates. Another criticism is that planning agencies in developing countries lack the power and resources to perform efficient and effective development control.

Property development control is seen as a mechanism to maintain standards. It is process laid down by legislation, which regulates the development of land and building. It is the professional activity carried out by town planners in order to ensure compliance with the approved master plan thereby ensuring orderliness.

In line with the above definition, development control actually regulates any building or rebuilding operations in, on and under the land. It also ensures an orderly growth of settlements by stipulating adequate standards for all aspects of land-use through the provision of adequate lighting, ventilation, open spaces and other socio-cultural facilities that make life worth living. The power to grant or refuse as well as attach conditions to permissions for development to take place gives the public agencies the big teeth.

Ogunsesan (2004) opined that development control is the “front line‟ of planning and the part, which affects the general public most. There is a direction in the exercise of development control on developers. The direction according to Ogunsesan (2004) is the objectives of development control, which include: the protection and enhancement of the built environment; the coordination of both public and private investments in land and property to ensure that land is efficiently used; and the control of pollution.  In development control process, time is a very important factor. There are two types of time factors in the development control process as pointed out by Faludi (1973): “internal and external time lag”. The internal time lag as he explained is the time it takes to act upon information received, while the external time lag, he explains as the time it takes for the action to be effected.

Property development control is carried out by planning authorities that have legal powers conferred on them to ensure that development is secured. The authorities according to Faludi (1973) are empowered to: plan, promote and secure the physical development and environmental improvement by economic; as financial developers they can initiate planning schemes and develop the area wholly or partly‟. Kimaryo (1992) is of the view that „though the planning authorities are empowered legally to carry out their duties, it may still be restricted. Its effectiveness reduced by lack of political backing and support from the top echelon of government functionaries‟.

Furthermore, development control is seen as a powerful implementation weapon in the planning armory. Positive encouragement is given to developers to compel them to willingly develop their land with due respect to the requirement of the planning authorities. Public enlightenment is usually embarked upon which tend to encourage the public to want some sort of control over physical development.  Communication is a vital tool necessary for development control to succeed. An effective and efficient communication ensures „control development with people and not for people‟; for if people are carried along in development control process, the authority will be able to guide development with ease and achieve their set objectives of a well planned built-up area with good road network, building set-backs, ventilation, lighting and pollution free environment. On the other hand, if the members of the public are not informed, they may not accept the idea of control, with feelings that since they owned the land, they can as well carry out development the way they want and at their own time without due consideration.

1.2       Statement of Research Problem 

Rural- urban migration has caused congestion in the urban areas and left the towns and cities sprawling endlessly into the countryside with dire consequences for the provision of essential urban infrastructure. That is, the rate of expansion of each of old and  newly emerging town led to the emergence of uncoordinated land-uses, winding road network, traffic congestion, uncoordinated provision and distribution of socio-physical infrastructure, uncollected waste and the like, amongst others with great impact on the socio-economic well being of the inhabitants. All these are resultant effects of uncontrolled development in both rural and urban settlements in Nigeria.

The rapid growth of our settlements, particularly urban areas need to be controlled to prevent chaotic and haphazard physical growth and development, which certainly takes place in the absence of any development control measure. However, some of the rationales for effective development control are the achievement of balanced, coordinated and good development of the environment; it ensures structural soundness and the adequate provision of necessary utilities, services and facilities for the proposed buildings; protection and the development of the environment so that the activities of men do not have adverse effects on it. This uncontrolled development has led to the environmental situation as presently witnessed in some squatter settlements of Abuja and other big town and cities in Nigeria. It is against this background that this study seek to evaluate the impact of property development control on residential property in Karu, Nasarawa State.

1.3       Aim and Objectives of the Study

The aim of this project is to evaluate the impact of development control on residential property value in Port Harcourt metropolis.

To achieve the aim above the following objectives were pursued

1. To examine the effectiveness of development control in the Study Area
2. To identify the functions of property development control
3. To evaluate the impact of the development control on residential property value
4. To identify the possible problems militating against the effectiveness and efficiency of development control in the study area.

1.4       Research Questions

1. How effective is development control inPort Harcourt metropolis?
2. What are the functions of development control?
3. What impact has development control made to real estate development in Port Harcourt metropolis?
4. What are the possible problems militating against the effectiveness and efficiencyof property development control in the study area?

1.5       Significance of the Study

This project will help to overcome the challenges that are currently facing in development authority in Rivers state especially Port Harcourt metropolis by the time this project is completed as it will serve as an eye opener on relevance of development control towards effective and efficient development of urban and rural areas in Nigeria.

The result of this study will enlighten property developers and investors on the need to comply with development control authority as development control generally impact positively on residential property development.

Students and other researchers will find this research useful as it will serve as reference to the department of estate management and valuation.

1.6       Scope and Limitations of the Study

There are different types of property development, this project mainly concern on the evaluation of the impact of development control on residential property value in Port Harcourt metropolis.

In the course of carrying out this study several problems were encountered among which are:

Financial constraint– Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).

Time constraint– The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

Uncooperative attitude of Respondents: Some respondents were very reluctant in responding to the research questions which tried to affect the research but the researcher make concerted effort to convinced them. 

1.8     DEFINITION & OPERATIONAL OF TERMS

• Development:  used here means an event constituting a new stage in a changing situation i.e. process development or being developed
• Control:  implies the power to influence or checking direct result of a survey or experiment of an intelligence of organization.
• Impact: these means to have a strong effect on something either positive or negative.Residential: means involving living at the place where you are working, studying or being looked after.
• Property: a thing or things belonging to someone or possessions collectively i.e. an attribute, quality or characteristics of something.

1.9       HISTORICAL BACKGROUND OF THE STUDY

Rivers State, also known as Rivers, is a state in the Niger Delta region of southern Nigeria (Old Eastern Region).^[5] Formed in 1967, when it was split from the former Eastern Region, Rivers State borders includes; Anambra and Imo on the north, Abia and AkwaIbom on the east, and Bayelsa and Delta on the west. The state capital, Port Harcourt, is a metropolis that is considered to be the commercial center of the Nigerian oil industry.

With a population of 5,198,716 as of the 2006 census, Rivers State is the 6th most populous state in Nigeria.^[8] Rivers State is a diverse state that is home to many ethnic groups, the majority being Igbo or Igboid, but also including the Ogoni and Ijaw. The state is particularly noted for its linguistic diversity, with 28 indigenous languages being said to be spoken in Rivers State, the most dominant of which are the Igbo speaking groups, the Ogoni and Ijaw languages.^[9] Rivers State is the 26th largest state by area, and its geography is dominated by the numerous rivers that flow through it, including the Bonny River.

The economy of Rivers State is dominated by the state’s booming petroleum industry. Although the rise of the oil industry has led to increased revenue for the state government, mismanagement and corruption have prevented the state from rapid development and meaningfully tackling poverty.^[11] During the 2000s, Rivers State saw a rise in the number of cult killings committed within the state.^[12] In 2019, Governor EzenwoNyesomWike declared Rivers State to be a Christian state because it is made up of 90% Christians and 10% orthodox with few strangers practicing Islam unconventionally.

Geography

Rivers State is a predominantly low-lying pluvial state in southern Nigeria, located in the eastern part of the Niger Delta on the oceanward extension of the Benue Trough.^[19] The inland part of the state consists of tropical rainforest, and towards the coast, the typical Niger Delta environment features many mangrove swamps. Rivers State has a total area of 11,077 km² (4,277 sq mi), making it the 26th largest state in Nigeria. Surrounding states are Imo, Abia and Anambra to the north, AkwaIbom to the east and Bayelsa, Delta to the west. On the south, it is bounded by the Atlantic Ocean. Its topography ranges from flat plains, with a network of rivers to tributaries.

Climate

Ogoni Climate activists and others in Port Harcourt protesting environmental degradation in 2015.

Rainfall is generally seasonal, variable, as well as heavy, and occurs between the months of March and October through November. The wet season peaks in July, lasting more than 290 days. The only dry months are January and February having little to no effect.

Total annual rainfall decreases from about 4,700 mm (185 in) on the coast, to about 1,700 mm (67 in) in the extreme north. It is 4,698 mm (185 in) at Bonny along the coast and 1,862 mm (73 in) at Degema. For Port Harcourt, temperatures throughout the year are relatively constant with little variation throughout the course of the seasons. Average temperatures are typically between 25 and 28 °C (77 and 82 °F). Some parts of the state still receive up to 150 mm (6 in) of rainfall during the dry period. Relative humidity rarely dips below 60% and fluctuates between 90% and 100% for most of the year.

IMPACT OF COMMUNITY DEVELOPMENT ON COMMERCIAL PROPERTY

IMPACT OF COMMUNITY DEVELOPMENT ON COMMERCIAL PROPERTY

Abstract

Road construction is a socioeconomic activity in most urban centers, it is long piece of ground specially prepared with a hard level surface for people, vehicles to travel upon, a greater part of the nations resources. Since 1941, a lot have been spent in road construction, maintenance, expansion and rehabilitation spread through the nations which is one of the factors affecting property value, for this reason the research is aimed at examining the impact of road construction, expansion and rehabilitation on property value with a particular interested in Osogbo town, in Osun state.  Literatures on the topic were reviewed with proper citation. 100 questionnaires were administered. The data obtained were analyzed using tables and description. It was found that there was notable increase in property value after road construction and it has impacted the community positively, government have been encouraged to levy betterment tax on occupiers / owners of the commercial properties. It was recommended that road should be constructed to other nearby town so as to improve property value and foster business relationship in the area.

CHAPTER ONE

1.0       INTRODUCTION

Community development has been one of the most significant social forces in the process of planned change during the last three decades. In the past change has occurred without plans or guidance, but today the increasing trend towards planned change enabled large segments of people to participate in the planning and change creating programs which affect their lives. Community development as an instrument of change has become a controversial topic and one hopes this will change the attitudes of policy makers.

The United Nations defines community development as “a process where community members come together to take collective action and generate solutions to common problems.” (UN, 2014). It is a broad concept, applied to the practices of civic leaders, activists, involved citizens, and professionals to improve various aspects of communities, typically aiming to build stronger and more resilient local communities.

Community development is also understood as a professional discipline, and is defined by the International Association for Community Development as “a practice-based profession and an academic discipline that promotes participative democracy, sustainable development, rights, economic opportunity, equality and social justice, through the organisation, education and empowerment of people within their communities, whether these be of locality, identity or interest, in urban and rural settings (Alison and Marilyn, 2011).

Community development seeks to empower individuals and groups of people with the skills they need to effect change within their communities. These skills are often created through the formation of social groups working for a common agenda. Community developers must understand both how to work with individuals and how to affect communities’ positions within the context of larger social institutions.

Community development has gained universal recognition in the last three decades as a substantial force for inducing planned change. Rapid technological advances have resulted in a series of inescapable social realities, and community development can help adapt to these new realities. Community development provides the possibility of altering by democratic means at times antihuman directions of technology, urbanization towards more human ends and property development.

Community development in forms of road construction, electricity, pipe born water, urban housing is socio–economic activity which brings opportunities as a result of improvement in the general activities of people which facilitate business activities and enhances the value of commercial properties.

Commercial properties are important in physical and economic development of towns and cities all over the world. Commercial property and land values tend to increase in areas with expanding community developments /  infrastructure, and increase less rapidly in areas without such improvements, rapid and continued rise in housing and prices are expected  in cities with community development, rapid economic and population growth (Gold Berg, 2017) man, nations, town regions and the world itself would be severely limited in development without community development, which is a key factor for physical and economic growth (Oyesiku, 2012).

Community development usually has three major elements: (a) community members’ well-being or welfare involving both material sufficiency and non-economic aspects of living such as health and education; (b) resource development, involving increased production and efficiency; and (c) organizational development, involving the maintenance and creation of social and economic structures through which members of the community may channel their energies for the betterment of community living (Baker, 1989:48). The ultimate goal of community development is therefore, to develop members’ capabilities and potentials to affect their well-being and quality of life through maximizing resources utilization to benefit them socially and economically. This could only be achieved through effective management of community development programmes as well as having highly committed and well-trained professionals not only in the technical disciplines but also in the community capacity building. The paper focuses on community capacity building as a community development process.

Similarly, commercial activities like retail, wholesale business, has attracted consumers and ancillary service providers. This partly caused increase in demand for commercial space and its effects on commercial property values within a community. There have been increase in rental values of commercial properties within a developed community., therefore this study seeks to examine the impact of community development on commercial property.  

1.       Statement of Problem

Poor road network is one of the factors affecting property values. It makes a village town or state to be backward in economic growth and development. It is the socioeconomic impact of the road construction on property values that necessitate this study.  What are the impact of road construction, expantsion and rehabilitation on property value?

1. Aim and Objectives

The aim of this study is to examine the impact of road construction, expansion and rehabilitation on property rental values in Osogbo. In other to achieve the above aim, the following objective shall be pursued.

1. To examine the state of the available road network in the study area.
2. To asses the supply of commercial property in the study area.
3. To examine the rental value of commercial property in the study area before and after road construction.
4. To determine the extent to which road construction has affected property values.
5. To recommend the way forward.

1. Research Question
2. What is the nature of available road network in the study area?
3. What is the growth rate of supply of commercial property in the study area?
4. What are the values of property from 2010 – 2015?
5. To what extent has road construction has affected property values?
6. What way can road network be increase?
   1. Significance of the Study

This study focus on the impact of road construction on commercial property rental value. Accessibility is the most important element that enhance property values. This research will encourage government to provide good road network as it has positive impact on commercial property rental values.

The greater the accessibility of a location the comparative advantage to commercial property users, and the greater the comparative advantages to the demand for more property in the study area and finally this research will also serve as a requirement for the award of degree in course of study.

1. Scope and Limitations of the Study

This research is confined to the study of impact of road construction, expansion and rehabilitation on property value in Osogbo, the research covers property value found within Osogbo metropolis.

1.6       Historical Background of the Study Area 

The early history of Osogbo is essentially the legendary account of the spirit-world; it is the history of the early people whom we call the spirits and fairies. This is in line with Yoruba traditions, which use mythical stories to explain the origins of the ruling families of an early Yoruba state.

Osogbo according to Yoruba oral history had been founded as early as Oduduwa period. Oso-igbo, the goddess of Osun River, was the Queen and original founder of Osogbo. She was credited with many important achievements, which helped to establish the settlement.

Osogbo the capital of Osun lies on coordinates 7°46′ North 4°34′East with an area of 47kmsq. According to the 2006 Population and Housing Commission Census, the city has a population of 156,694 people. Osogbo shares boundary with Ikirun, Ilesa, Ede, Egbedore and Iragbiji and is easily accessible from any part of the state because of it’s central nature. It is about 48km from Ife, 32km from Ilesa, 46km from Iwo, 48km from Ikire and 46km from Ila-Orangun.

Osogbo is a commercial and industrial centre. This started in 1907, when the British Cotton Growing Association sited an industry for growing and ginning of cotton. The Nigerian Tobacco Company (NTC) built its first factory in Osogbo. In this same year, a major turning point for the city which helped in its industrial and commercial development occurred.  The railway tracks were constructed linking it to other parts of Northern Nigeria.  This attracted people from far and near.

The Ataoja of Osogbo is the traditional title of the King and he is the political and spiritual heads of Obas and Chiefs in Osogbo and Olorunda Local Government Areas.

Osogbo is famous for the annual Osun Osogbo Festival which attracts tourists from different part of the world.

1.7       Definition of Key Terms

1. Road: The Concise Oxford Dictionary defined road as specially prepared truck between places for the use of pedestrian, rivers and vehicles. It could also be a long narrow piece of ground especially prepared with a hard level surface for people, vehicles etc.
2. Property: Is a legal concept encompassing all the interests, right and benefit related to ownership. Properties consist of the right of ownership which entitle the owner to a specific interest or interest in what is a physical entity and its ownership Olusegun (2003).
3. Value: As the worth of something in terms of money or other goods for which it can be exchanged or quality of being useful or important. The word value does not have a specific and restricted meaning as it may mean different things to different people Olusegun (2003).
4. Commercial Properties: Immovable properties, land together with all the properties on it that cannot be moved with any attached rights paten business operation (Microsoft Encarta 2009 Microsoft Corporation).
5. Rental Value: As the rent which is an annual or periodic payment of money for the use of land or of land and building, rental value is the highest rent obtainable for a property in an open market at any given time Olusegun (2003).
6. Road Network: Road construction is defined by Lord Hale to be open passage of bring, which from the situation of the adjacent land, and its own depth and wideness with nodal link and connectivity, afford a secure place for the common ridding and anchoring of vehicles for human and goods. Zangand lund University (2004), sees road network to consists of large number of interwoven roads exhibiting many patterns ranging from star like to grid – like with irregular patterns becoming recognized.

EFFECT OF POPULATION GROWTH ON THE DEVELOPMENT OF RESIDENTIAL PROPERTY IN WUSE ABUJA

EFFECT OF POPULATION GROWTH ON THE DEVELOPMENT OF RESIDENTIAL PROPERTY IN WUSE ABUJA

CHAPTER ONE

1.0       Introduction

1.1       Background of the study

The impact of rapid population growth on housing development in a developing economy is usually a consequence of the push of the rural areas and the pull of the town. There is always an upsurge and conglomeration of people in city centres with the resultant effects on housing growth arising from acute unemployment. This growth and physical expansion of cities have been accompanied by unplanned urban sprawl, environmental pollution, deterioration, deficiencies in modern basic facilities, and general urban decay (Akpakpan, 2017).

As increased poverty and urbanization exert more pressures on urban facilities, most Nigerian cities tend to have lost their original dignity, social cohesion and administrative efficiency. The relationship between population and housing is two-sided. On the one hand, population change leads to a changing demand for housing. Population growth, and particularly a growth in the number of households, leads to a growth in housing demand. Population decline might lead to a decrease in housing demand. This will, however, only happen in the long run, after not only the number of people but also the number of households has started to decline (Eric, 2015).

Residential property refers to building that is developed for people to live or undeveloped land that is designated for residential use. Residential properties could be a consumption goods, or investment goods (Sratton, 2008). As a consumption goods, it is acquired for owners occupation while as investment goods it is acquired for the purpose of deriving optimum return from outright sale or letting of the property. If this is the case, the price or rent of the residential property becomes very important to the seller and buyer or landlord and the tenant. Hence investment in this type of property is regarded as a considerable source of wealth for many investors.

Property development comprises a significant component of total Nigeria economic output. The property development process involves the continual combination of significant factors of production (land, labour, capital and enterprise). In addition, property development has been characterised by some significant cyclical influences as the process involves significant risk. It is in the interests of capital markets, market participants and the public sector that property development processes are better understood so as to ensure efficient allocation of physical resources, human resources and capital to meet the needs of the ever growing of population of Nigeria (Cadman, 2014).

The impact of rapid population growth on property development and conditions is far more than merely a demographic or quantitative one. Whereas the population growth and urbanization process in the developed countries was the result of rapid industrialization, the growth in Nigeria like most other developing nations is a consequence of the “push” of the rural areas and the “pull” of the town (Kehinde, 2010). The majority of African urban centres developed and continues to develop as commercial-administrative and servicing entities. In Nigeria like in most other developing countries, the growth of the tertiary sector is often a symptom of poverty and stagnation rather than economic development. Consequently, population growth in most of the African countries is characterized by a growing gap between employment opportunities and demand, and an ever increasing shortage of urban services and facilities which are accessible to a diminishing share of urban population. The implication is this deplorable and alarming situation which aggravates the already acute housing problem. It is against this background that this study seek to examine the effect of population growth on the development of residential properties in Wuse Abuja.

1.2       Statement of research problem

World population has risen to over 6.3 billion people and by 2030 over 60 percent of the world’s population is expected to be living in cities. There are now over 400 cities with a population of over a million people (UN-Habitat, 2015).  As population growth is an underlying factor for the demand of housing, without new supply of dwellings, it pushes up the prices for both renting and purchasing dwellings. The problem is further compounded in many of the large cities with a change in living preferences that has resulted in a fall in household rates, particularly in the western world. Hence, population movement to the city and fewer people per household means the supply of more housing is needed. The growth of the population in Abuja Municipal Area Council has assumed a geometrical proportion, the provision of urban infrastructure and housing to meet this demand is, not at commensurate level. This has resulted in acute shortage of housing / residential properties to the teeming population with. The extent of the housing shortage in Abuja is enormous. The inadequacies are far-reaching and the deficit is both quantitative and qualitative; even those households with shelter are often subjected to inhabiting woefully deficient structures as demonstrated in the existence of slums and shanties in and around the city of Abuja. They reside in the slums and squatter settlements scattered around the city and are predominantly engaged in informal economic activities which encompass a wide range of small-scale, largely self-employment activities. This problem can only be brought under control through urban consolidation and/ or development of properties in the urban center. One major effect of this is the cost of infrastructure required, as either new infrastructure has to be put in place or upgrading and extending the existing infrastructure. It is on this note that this study seek to examine the effect of population growth on the development of residential property in Wuse Abuja.

1.3       Aim and objectives of the study

            Aim:

The aim of this project is to examine the effect of population growth on the development of residential property in Wuse Abuja.

Objectives:

The specific objectives of this study include:

1. To determine the cause of population growth in Wuse Abuja and Nigeria at large.
2. To evaluate the state of residential properties in Wuse Abuja
3. To determine the effect of population growth on the development of residential property in the study area
4. To identify other factors affecting residential property development Wuse Abuja
5. Assess the impact of population growth on the demand for residential properties in the study area

1.4       Research Questions

1. What are the causes of population growth in Wuse Abuja and Nigeria at large?
2. What is the state of residential properties development in Wuse Abuja?
3. What are the effects of population growth on the development of residential property in the study area?
4. What are the other factors affecting residential property development in Wuse Abuja
5. What is the impact of population growth on the demand for residential properties in the study area?

1.5       Significance of the study

The importance of the research is to be appreciated by all since concepts of population growth and its effect of residential properties development affects everybody irrespective of class, status or occupation.

However, the study will be importance to the following categories of persons.

1. Government (policy makers): The government will benefit from the study since it will provide the basics for making policy changes and formulating future policies. It helps the economy in planning for development especially in real estate development.
2. Students: The study is important to students since it will reveal more details and provide more information for those who are interested in finding out population trends in Nigeria and its consequences to development of residential properties in Nigeria and also for further studies.
3. Research: This study will provide more information for further research about the population growth and residential property development in Nigeria.
4. Investors in Real Estate: Real estate investors will benefit from the findings of this study as it enlighten on the effects of population growth on development of residential properties, it will put them in better position to make inform decision on how to invest their money.

1.6       Scope and limitations of the study

The scope of this study covers only the effect of population growth on the development of residential property in Wuse Abuja. Other properties such as commercial properties, industrial or educational properties will not be included in this research. Geographically, the study is limited to Wuse in Abuja the Federal Capital Territory.

Limitations

The researcher faced various problems when carrying out this field study. Some of these challenges included:

1. Some respondents were unwilling to fill the questionnaires since they were suspicious about the study. Many perceived it as sharing very vital information which they were not ready to furnish the researcher with.
2. Delays were experienced from the respondents who took very long to complete the questionnaires and constant postponement of the picking date proved to be very frustrating to the researcher.
3. At times some of the respondents did not fill in the questionnaires adequately and ignored certain sections that required the giving of opinions which made it difficult for the researcher to make adequate conclusions.

1.       Operational definition of terms

Population Growth: Population growth is the increase in the number of people that reside within a state or country.

Property development: Property development, is a business process, encompassing activities that range from the renovation and re-lease of existing buildings to the purchase of raw land and the sale of developed land or parcels to others (Wikipedia, 2017).

Property: This is the embodiment of tangible ownership right or bundles of right in real estate. It could also be described as a concept of right which can be held separately (Babatunde, 2003).

Rental Value: This is the worth or value of property in an open market. It is also the value arising out of the lease or renting out of a property on a periodic basis usually yearly.

Residential Property: it is a building that is used or suitable for dwelling purpose. They are dwelling house such as bungalows, duplex, detached houses, semi-detached houses, etc. (LBTT 4010)

1.8       The study area

Wuse is one of the district in Federal Capital Territory Abuja. Wuse District is the north western part of the city, with the Maitama District to its north and the Central District to its south. The District is numbered Zones 1-8.  Wuse Market is Abuja’s most popular market (Zone 5). The second most important Post Office in the city is located here.

This district also houses the Sheraton Hotel and Towers (Zone 4), Ibro International hotel, Rockview Hotel, the Nigerian Customs Services Headquarters, the Foreign Affairs Ministry Headquarters (Zone 1) and Federal Road Safety Commission (FRSC). National Agency for Food and Drugs Administration (NAFDAC) (Zone 7), Wuse General Hospital, and the Nigerian Tourism Development Corporation.

EFFECT OF INFRASTRUCTURE FACILITIES ON RENTAL VALUE OF RESIDENTIAL PROPERTIES IN IBADAN

EFFECT OF INFRASTRUCTURE FACILITIES ON RENTAL VALUE OF RESIDENTIAL PROPERTIES IN IBADAN

ABSTRACT

This study examines the impact of infrastructural facilities on residential property value in Ibadan. The study examined among other things, the provision of infrastructural facilities as an impetus for real Estate development and value in the study area. The study employed the use of structured questionnaire; the data collected were analyzed through simple percentage tables. The study revealed that the residential property in Ibadan has very limited number of these infrastructure facilities. The result of inadequate provision of these facilities has in most cases being reflected in the amount of rent paid for the properties in Ibadan. It is therefore recommended that infrastructures should be provided by both the private and public sectors to better the lot of the residents and to also ensure continuous flow of investors’ income (rent).

CHAPTER ONE

1.0       INTRODUCTIONS

One of the remarkable developments associated with the process of socio- economic change in Nigeria during the last seventeen years has been the damour for increase and improvement of infrastructural facilities. Infrastructural facilities involve the provision of services which the various levels of government in the country as well as various communities are collectively involved. This also includes services provided by voluntary agencies and private individuals for the benefits of the community at large. In the light of the harsh condition Nigeria has been going through recently, sky rocketing cost of building and construction, high cost of finance and unpredictable economic conditions there has been decrease in infrastructure development and little or no maintenance of the existing stock. There has therefore, arisen a need for finding alternative means of infrastructure development as it relates up grading and managing the present. Stock, thus, preserving our built emolument. In line with the basic need of shelter and its preservation, the need to have basic infrastructure in place for the development. Individual who commits capital into real estate as an investment intends to reap optimum returns from such investments. In order to achieve this aim, the investment must be strategically positioned where it has access to basic infrastructure so as to keep this property in a state to command a constant flow of income or benefits and an appreciation in capital value. The majority of investors in residential properties development in Nigeria are individual and a handful of corporate concerns, considering the problem of increasing cost the dilapidated ones still in use, infrastructure is almost static which over stretching of the existing ones continues. The federal government and it agencies like the development control have been doing all they can to improve the present infrastructural facilities stock. But the fact remains that the government does not have enough fund to improve on the entire stock. The study is critically examining the presence state of infrastructural facilities and will also recommended ways to improve these facilities. This is an attempt to increase values to tenants, optimize returns to property owners and presence our build environment. The findings could therefore be applicable to other residential areas presenting problem in Nigeria.

1.1       STATEMENT OF THE PROBLEM

Infrastructure facilities have over the years contributed immensely to the general well being of developed nations. Developing nations have also being able to exploit these facilities though not at a highly appreciative level Nigeria has over the years being grappling with the problem of inadequate infrastructural facilities. Corruption has being the bare of adequate provision of these facilities. Residential properties in Ibadan has very limited number of ‘wit1i these infrastructure facilities. The result of inadequate provision of these facilities has in most cases being reflected in the amount of rent paid for properties in Ibadan Residential properties areas that have of these facilities ar experiencing poor maintenance which affect their longevity the problem is Property owner in Ibadan are often unaware of how infrastructural facilities could to a large extent influence rent paid for there properties. This is evident in the fact that only few of them make effort to either proved these facilities or make effort to ensure that these facilities are provided.

1.2.      AIM AND OBJECTIVES OF THE STUDY

The aim of this study is to evaluate the impact of infrastructural facilities on rental values of residential property taking Ibadan as a case study. To achieve this aim the under listed objectives will be pursued.

1. To identify the infrastructural facilities in the study area.
2. To analyze the relationship between infrastructural facilities and property value.
3. To determine the nature and pattern of trends in rental values of residential property in the study area.

1.3.      SIGNIFICANCE OF THE STUDY

The research will help people to know about the impact of infrastructural Facilities on rental values of residential property development. The impact of infrastructural facilities plays in the property market and how to achieve feasible rental values or yields in residential properties In the future cannot be over emphasized in this work as it is used by Students and researchers.

1.5       Significance of the Study

This project is an attempt to assess the effect of infrastructural facilities on residential property value in Ibadan, the study discuss the types of residential property in the study area, identifies the types and condition of available infrastructural facilities available and tries to establish the relationship between infrastructural facilities and residential property rental value. The result of research will help developers, investors, real estate managers and valuers and the government to know the relevance of infrastructural facilities to residential properties and its effect on rental value thus given them a better chance to an informed decision.

The study will 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.

This study will also serve as a reference material for subsequent research related to the effect of infrastructural facilities on residential property value where researchers, students and scholars will tap into the wealth of knowledge provided in this study.

1.6       Scope and Limitations of the Study

The research work is confined to the study of the assessment of the effect of infrastructural facilities on residential rental value in Ibadan. 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.

There are several limitation encountered during the conduct of this research. These limitations include: non availability of adequate data which played a major limitation to this write up because of non-cooperative attitude of some respondents who were not willing to give information and data needed to aid findings, time was another major factor which affect the study as the researcher do not have enough time to make detailed investigation on all the aspects of the study. And the general unwillingness of some respondents to fill the questionnaire provided for the research made it difficult to gather data needed for this research study at the most appropriate time.

1.7       Operational Definitions 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 to 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       BACKGROUND OF THE STUDY

Ibadan  is the capital and most populous city of Oyo State, in Nigeria. It is the third-largest city by population in Nigeria after Lagos and Kano, with a total population of 3,649,000 as of 2021, and over 6 million people within its metropolitan area. It is the country’s largest city by geographical area. At the time of Nigeria’s independence in 1960, Ibadan was the largest and most populous city in the country, and the second most populous in Africa behind Cairo.

Ibadan is located in south-western Nigeria, 128 kilometres (80 mi) inland northeast of Lagos and 530 kilometres (330 mi) southwest of Abuja, the federal capital. It is a prominent transit point between the coastal region and areas in the hinterland of the country. Ibadan had been the administrative centre of the old Western Region since the early days of British colonial rule, and parts of the city’s ancient protective walls still stand to this day. The principal inhabitants of the city are the Yoruba people, as well as various communities (notably Igbo, Hausa, and Efik) from other parts of the country.

Ibadan, coined from the phrase “Eba Odan”, which literally means ‘by the edge of the meadow’, came into existence in 1829, during a period of turmoil that characterized Yorubaland at the time. It was in this period that many old Yoruba cities such as old Oyo (Oyo ile), Ijaye and Owu disappeared, and newer ones such as Abeokuta, new Oyo (Oyo atiba) and Ibadan sprang up to replace them.

According to local historians, Lagelu founded the city, and was initially intended to be a war camp for warriors coming from Oyo, Ife and Ijebu.^[7] As a forest site containing several ranges of hills, varying in elevation from 160 to 275 metres, the location of the camp offered strategic defence opportunities. Moreover, its location at the fringe of the forest (from which the city got its name) promoted its emergence as a marketing centre for traders and goods from both the forest and grassland areas.

In Ibadan, unlike other Yoruba cities with traditional kingship institutions, the warrior class became the rulers of the city as well as the most important economic group. Ibadan has a tropical wet and dry climate (Köppen climate classification), with a lengthy wet season and relatively constant temperatures throughout the year. Ibadan’s wet season runs from March through October, though August sees somewhat of a lull in precipitation. This lull divides the wet season into two different wet seasons. November to February forms the city’s dry season, during which Ibadan experiences the typical West African harmattan. The mean total rainfall for Ibadan is approximately 1,230 millimetres or 48 inches, falling over about 123 days. There are two peaks for rainfall, June and September. The mean daily temperature is 26.46 °C or 79.63 °F, the mean minimum 21.42 °C or 70.56 °F, and the relative humidity 74.55%.

THE IMPACT OF DEPRESSED ECONOMY ON REAL ESTATE FINANCE

THE IMPACT OF DEPRESSED ECONOMY ON REAL ESTATE FINANCE

CHAPTER ONE

INTRODUCTION

1.1       Background of the Study

Global trends have had an impact on the processes and outcomes of business fortunes even in developing countries; and have caused industrial relation actors to think differently about their goals. The current global economic crisis has been interpreted in many ways, chief of which is that it signals the end of capitalism or free market economic doctrine as exemplified by the American economic system. It is said to reincarnate the world economic depression of the 1930s which saw huge loss of wealth in both the money and capital markets around the capitalist world and led to actual and attempted suicide by many investors. It was a crisis that arose from the failure of the market to correct itself. Global economic depression describes the growing economic, political, technological, and cultural linkages that connect individuals, communities, businesses, governments and countries around the world and the negative impacts it carries with it as felt in the economies of different states and countries (Ajanlekoko, 2001).

Real Estate finance by its very nature is a capital intensive venture which if it is to be financed through personal financial resources will require slow and tedious accumulation of savings. However, since real estate provides benefits over many years, long-term credit financing is a more logical option as it will spread the repayment burden. But this requires the availability of long-term funding, and for which must be institutional capacity, structure and mechanism that will allow a convenient and effective linkage between the savers/investors and the consumers of such funds.

The sourcing of funds for investment in real estate development poses a great deal of problem for the developer. This is largely due to economic instability and stringent measures imposed by most financial institutions. This is compounded by the fact that the interest rate structure has had an unfavourable impact on funding the development of real estate. Since the financing of real estate development is a long term project, it has necessitated the high interest rate that is being charged on the funds provided for such development purposes. Hines (1995) revealed that six major real estate financing methods are used across the world namely; Joint Venture, Equity and Debt Financing, Sale-lease Back Financing, Advance Payment of key money and Sale of Securities.

In Nigeria, real estate is typically financed through a number of institutional sources: Budgetary appropriations, Commercial/Merchant Banks, Insurance Companies, State Housing Corporations and the Federal Mortgage Bank of Nigeria (FMBN): and now the newly established Mortgage Institutions all these constitute the formal institutions. Informal institutions such as thrift and credit societies, and money lenders who have contributed and are still contributing substantially to the finance of real estate finance are substantially affected during a depressed economy.

The Nigerian economy faces the rippling effects of the depressed economy resulting to breakdown and decline in economic vigor. The effects find expression in downsizing, mass unemployment, and crashes in the money market. There is need to understand the dynamics of the present economic depression with careful study and examination of the issues involved and how it affects real estate finance in Nigeria(Zubairu, 2001). The Nigerian economy has continued to witness renewed and sustained recession, characterized by galloping inflation, unemployment and declining businesses. The general business cycle of depressed economy affects human resource management. Such factors as interest rates, inflation, and economic growth help determine the availability of fund for real estate investment (Mailafia, 2005).

According to Ebie (2005), the Nigerian situation has been tagged feeble due to the negative effects the global economic meltdown and depression has had on real estate finance. Every industry has had its fair share of the troubles and companies are licking their sores with resultant effects on the masses. Therefore, the thrust of this study investigates the impact of depressed economy on real estate finance in Nigeria.

1.2       Statement of the Problem

Real estate practice has continued to express divergent views on the impact of the current depressed economy in Nigeria on the nation’s real estate finance. While some operators are complaining of low demand, over supply, falling prices and many unsold/unoccupied houses with no buyers or tenants, others see the crash in the property market as opportunities for brave investors with expectation of high returns when the country climbs out of recession. Most of the real estates in high-brow areas like Asokoro, Gwarinpa, Maitama, Wuse II, Utako, Katampe districts are undeveloped or unoccupied as a result of the high cost of renting or leasing. Houses and estates in Gaduwa, Apo, Dei-Dei, Gwarimpa, Lugbe, Kubwa, Gudu, Life Camp, are also in similar situation of no buyers or renters. But in spite of the glut in the real estate market, property values have stagnated and in most cases have increased tremendously in the low and medium income neighbourhoods in Abuja. Therefore this research seek to examine the impact of depressed economy on real estate finance.

1.3       Aim and Objectives of the Study

The aim of this project is to examine the impact of the depressed economy on real estate finance in Abuja with particular interest in Garki.

The following specific objectives are pursued:

1. To identify the causes of depressed economy
2. To assess the sources of real estate finance
3. The determine the development and management of real estate during a depressed economy
4. To determine the average rental value of properties during the recessed period within the study area.
5. To evaluate the impact  of depressed economy on real estate finance.

1.4       Research Questions

1. What are the causes of depressed economy?
2. What are the sources of real estate finance?
3. Are there development and management of real estate during a depressed economy?
4. What is the average rental value of properties during the recessed period within the study area?
5. What are the impact  of depressed economy on real estate finance?

1.5       Significance of the Study

The following are the significance of this study:

Findings from this study will be a useful guide to the policy makers and the government of the day on how real estate sector can contribute to the nations development and how the housing policies can be implemented effectively to boost economic growth.

It is hoped that this study would help estate developers to appraise the significance of depressed economy on real estate finance while investing in real estate development.   The research will be of great benefit to the local government, investors in the real estate sector such as property developers, end users and government parastatals on the situation of recession on real estate finance in the study area. This would enable them to know the essence of recession in real estate practice.

This research will also serve as a resource base to other scholars and researchers interested in carrying out further research in this field subsequently, if applied will go to an extent to provide new explanation to the topic.

1.6       Scope and Limitations of the Study

The scope of this study on the impact of depressed economy  on real estate finance in Abuja will cover the structure and activities of real estate in Nigeria and its contribution to the nation’s economy.

Limitation of the Study

Financial constraint– Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).

Time constraint– The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

1.7       Definition of Terms

Real Estate: Is “property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this (also) an item of real property, (more generally) buildings or housing in general.

Depressed  Economy: An economy is said to be depressed when it has faced a negative economic growth for two consecutive quarters.

Management: the process of dealing with (planning, organizing/directing and controlling/supervising) things or people towards achieving set objectives.

Property: A thing or things owned or possessed by someone. For the purpose of this paper, however, property shall mean the rights one holds in the ownership (as by a landlord) or possession (as by a tenant) of any land or landed property.

Property Management: Is an act of intermediation between owners and occupiers on issues affecting the parties arising from ownership and occupation of buildings.

1.8       Historical Background of the Study Area

The Federal Capital Territory Abuja as create in 1976 by decree No. 6 of (197) which also established the Federal Capital Developments Authority (FCDA) as the Federal Government Agency responsible for the design contraction, and administration of the territory. The decree vested ownership and control of land in the three territories in the federal government of Nigeria.

            Location

The territory which is located at the center of country cover an case of 8,000 square kilometric is therefore more than twice the land area of Lagos State (3,535/km) and about two third of that Imo state (31,032/KM) because of its central location the major cities to Abuja is easily accessible form all part of Nigeria.

The Federal Capital City itself which is located in the eastern fringe of the territory designated to cover an area of the territory and at full development the city is expect to have a total population of 3.2 million.

This means that 7344 square kilometer (97%) of the land are of the territory constitute the city regional component to be utilized for other service such as the development of agriculture to supply the population of the city and the development of satellite town to absorb the excess population of the city.

AN EXAMINATION OF THE EFFECT OF HOUSING DEMAND ON RENTAL VALUE OF RESIDENTIAL PROPERTIES

AN EXAMINATION OF THE EFFECT OF HOUSING DEMAND ON RENTAL VALUE OF RESIDENTIAL PROPERTIES

CHAPTER ONE

1.0       INTRODUCTION

1.1       Background of the Study

Housing is one of the three basic needs of man. It is the most important factor for physical survival of man after provision of food. A deficiency in housing can profoundly affect the health, welfare and productivity of man. It is an indispensable necessity without which man’s survival is impossible. Beyond the fabric, services and the contents of the dwelling, housing encompasses all that surround the dwelling to stimulate healthy living. Housing has to be quantitatively and qualitatively adequate in order to fulfill its basic purposes (Aderamo and Ayobolu, 2010).

Housing as a key determinant of quality of life, can be measured at individual, household and community levels as well as human rights in the cycle of human life (Magigi and Majani 2006). It is unique among consumer goods in its pervasive economic, social, and psychological significance. The physical and social environments, within the house and the neighbourhood, support family functioning and children’s personal growth. Adequate and decent housing provision has been the central focus of developing countries’ government.

Housing demand has witnessed unprecedented increase in the past decades. The low level of economic development, physical, social and cultural factors have created, among others, immense obstacles to the provision of adequate housing to the majority of population. The population growth rates are growing faster than the provision of new housing and housing infrastructure. This has resulted in intensive usage of the existing stock of housing and deterioration of housing environments. Some of the manifestations of housing and residential land use intensification are increasing room occupancy levels, housing adjustments involving physical changes in housing space and housing space conversion (Awanyo, 1992).

Housing in all ramifications is more than a shelter since it embraces all the social services and utilities that make a community or neighbourhood a livable environment. The result is manifested in growing overcrowding in homes, neighbourhoods and communities as well as increasing pressure on infrastructural facilities and rapidly deteriorating environment (National Housing Policy, 2006).

The housing demand in Nigeria can be examined from urban and rural perspectives. In the urban centres the situation is characterized by acute shortage exacerbated by the rapid rate of urbanization with its associated high population growth rate. This problem of housing shortage is also highly associated with overcrowding and insanitary conditions. The situation in rural areas is characterized by poor quality housing with inadequate utilities like potable water, electric power supply, all season roads etc. In addition to the urban and rural perspectives of the Nigerian housing situation is that of poverty. About 70% of the Nigerian population are poor or are of low – income groups (Federal Office of Statistics, 1996). This reflects the inability of most of the population to afford good and decent housing especially in the inflation prone economy. (Igwe- Kalu and Chima, 2006).

1.2       Statement of the Problem

The deficits in housing demand have resulted in numerous problems. The problems include overcrowding, reduction in the vacancy rate, high room occupancy rates, proliferation of informal settlements, pressure on the existing housing stock, pressure on existing infrastructure, deterioration of the infrastructural facilities, inadequate basic amenities, poor spatial arrangement, and deteriorated environment. Others are high rents, increase in housing prices, lack of adequate and affordable housing and decrease in Marginal propensity to save (MPS) of the household as greater part of the income is spent on rent. It is against this background that this study examines the effect of housing demand on rental value of residential properties.

1.3       Aim and Objectives of the Study

The aim of this project is to examine the effect of housing demand on rental value of residential properties.

The specific objectives of this study include the following,

1. To examine housing demand in Kaduna metropolis
2. To identify factors that influence housing demand in the study area.
3. To evaluate the effects of housing demand on rental value of residential properties in the study area.

1.3       Research Questions

1. What is the trend of housing demand in Kaduna metropolis?
2. What are the factors influencing housing demand in the study area?
3. What are the effects of housing demand on rental value of residential properties in the study area?

1.5       Significance of the Study

The condition of human existence is directly related to the environment. This environment comprises mainly the dwelling housing. However, improving housing demand and determining its effects on rental value of residential properties become a priority for every nation where there is poor condition of housing provision and demand.

This study addresses the effects of housing demand on rental value of residential properties. It identified factors that influence housing demand, which is crucial to the formulation of appropriate housing policies and programmes. The study provides empirical evidence on the nature and extent of factors that determine housing demand. The information is crucial to the policy makers because they form basis for formulation of policies and programmes towards addressing the problem of housing shortages.

This will help them to identify and tackle the challenges facing the provision of adequate housing for all Nigerians. It gives insight to private developers on the nature of housing demand as well as the housing stock to be provided in order to meet the demand. Finally, this study will be a reference point to future researchers in the field of housing and community development.

1.6       Scope of the study

This study examines the effects of housing demand on rental value of residential properties. This is limited to examining the trend of housing demand, identify the factors that influence housing demand, determine whether there is a variation in housing demand among various group of residents and evaluate the effects of housing demand on rental value of residential properties. Geographically this study is limited to Mando, Kaduna.

1.7       Definition of Terms

Housing: Housing refers to houses or buildings collectively; accommodation of people; planning or provision of accommodation by an authority; and related meanings. The social issue is of ensuring that members of society have a home in which to live, whether this is a house, or some other kind of dwelling, lodging, or shelter (Aribigbola, 2008)

Affordable housing: Affordable is a relative term, the common definition is when the cost of shelter does not exceed 30 percent of gross household income.

Housing Demand: It is defined, as the amount and quantity of housing people are willing and able to pay for at a particular time.

Housing needs: It is the number of housing units required to accommodate a population at a given standard of housing occupancy.

Housing Stock: It is regarded as the total number of existing habitable housing units in a given place.

Housing Unit: It is defined as a unit of accommodation occupied by a household, be it one person or more.

Vacancy rates: It is most useful for measuring the existing match between households and housing units. That is the percentage of total available housing unit not occupied.

1.8       The Study Area

Kaduna is the state capital of Kaduna State in north-western Nigeria, on the Kaduna River. It is a trade centre and a major transportation hub for the surrounding agricultural areas, with its rail and road junction. The population of Kaduna was at 760,084 as of the 2006 Nigerian census.

Until the late eighties when Kaduna State seemed to have slid into intermittent sectarian and ethnic violence, its capital city, Kaduna, was one of the most peaceful, cosmopolitan and politically important cities in Nigeria. These crises have, however, merely diminished rather than eliminated the city’s virtues, thanks largely to the effective measures the authorities in the state adopted from 2000, the year of the worst crisis, to curb the hostilities in the state.

Established in 1912 by Lord Frederick Lugard, first as a garrison town and then as the regional capital of the then Northern Protectorate, Kaduna soon attracted people of all races, religions and cultures. Within two decades of its establishment, it grew from an almost virgin territory of small scattered settlements of the indigenous population, mostly the Gbagyi, to a town of over 30,000 people. This population comprised the British colonizers, artisans from other West African British colonies, artisans and clerks from the Southern Protectorate as well as labourers and traders from the Hausa, Nupe, Kanuri, Fulani and other tribes in the Northern Protectorate.

By 1963 the town had about 250,000 residents and nearly 30 years later, the 1991 census put its population at 1,307,311, a little over a third of the population of the entire state.

Kaduna’s history reflects that of the North in particular and Nigeria in general. This history dates back before 1912, the year Lord Lugard chose it to become the dual capital of the North and Nigeria. The road to Kaduna actually started in 1900 when Lord Lugard was first appointed the High Commissioner of the Northern Protectorate. At that time Lokoja, at the confluence of the mighty rivers Niger and Benue, was the centre of British missionary activities and British trade. It was also the headquarters for its wars of occupation of the North.

Lugard first settled in Lokoja as regional capital to continue with the colonial conquest of the region. Two years later, i.e in 1902, he moved the capital from Lokoja further upstream of River Niger, to Jebba. However, Jebba remained the headquarters for only a few months. Towards the end of the year, he moved even further upstream to Zungeru with the intention of making it the permanent capital of the North. Many Nigerians will remember Zungeru, a major railway town, as the birth place of Nigeria’s foremost nationalist and first president, Dr. NnamdiAzikiwe. His father had worked there as a railway staff.

For a while it seemed as if Zungeru had succeeded where Lokoja and Jebba had failed; it remained the regional capital for 10 years. However, with time, Lord Lugard himself began to doubt the wisdom of his choice especially given the vastness of the North which had been “pacified” by 1906. He then began a search for a more central and more accessible location than Zungeru.

His search finally ended at a location on the Zaria plains, roughly in the middle of the region. Not only was Kaduna centrally located and much more accessible than Zungeru, the Zaria plains in which it was located were well served by two major tributaries of River Niger, River Kaduna, which gave the settlement its name, and River Gurara. River Kaduna itself was so called because it was crocodile infested, kadduna being the plural of ‘crocodile’ in Hausa.

Apart from its centrality, accessibility and abundant water supply, the location also possessed a clement environment. Also, following the not-too-happy relationship of the colonialists with the large indigenous population of Lagos as capital of the Lagos Colony and Calabar as capital of the Southern Protectorate, the British considered the virginity of a location an important consideration in their choice of a capital. Kaduna, with its sparse and scattered settlement of the indigenous population, satisfied this criterion.

No sooner had Lord Lugard settled down in Kaduna as regional capital in 1912, than he began to plan for it as Nigeria’s capital, ahead of the amalgamation of the Northern and Southern Protectorates in 1914. This followed his promotion that same year as Governor-General of the amalgamated Nigeria. As Governor-General, he did not hide his antipathy towards Lagos and recommended that the capital be moved to Kaduna as quickly as possible. “Government House, Lagos,” he wrote in one of his papers, “would make an excellent hotel if the transfer to Kaduna was achieved.”

The transfer was never achieved. First, the Colonial Office in London thought Kaduna was too far inland for quick and effective communication between motherland and colony. Second, in 1919, Lord Lugard was succeeded as Governor-General by Lord Clifford, who did not share Lugard’s loathing for Lagos. In any case, such a transfer was considered too expensive an exercise by the British.

And so it was that Lugard could not fulfill his wish to see Kaduna become the capital of both the North and Nigeria. However, as the capital of the biggest region in the country – at 730,885 square meters the North was more than three times the size of the Western and Eastern Regions combined. It was also the most populous – Kaduna City was to assume an unmatched political importance in the country, not least because it became the headquarters of the Northern Peoples’ Congress. The NPC eventually became the ruling political party in the North and the senior partner in a coalition government at the centre up to the first military coup in January 1966.

The political status of Kaduna before independence rose a notch higher when a group of Western-educated Northerners led by the late Dr. R.A.B. (Russel Aliyu Barau) Dikko, the region’s first medical doctor, founded the Jam’iyyan Mutanen Arewa AYau (Association of Northerners Today), in 1948 in the city, ostensibly as a cultural association. The JMA transformed into a political party in October 1951 and subsequently chose Sir Ahmadu Bello to lead it. It held its first convention in Kaduna in July 1952.

The most important symbol of the city’s political importance was and remains the Lugard Hall Complex, named after Lord Lugard. Located at the heart of Kaduna and painted in the national colours of green and white, the complex with its prominent dome sits on a large expanse of land that forms a huge roundabout bound almost right round by Coronation Crescent and by the northern end of the broad Independence Way on its southern entrance. It served as the regional House of Assembly and House of Chiefs during the First Republic. Today it serves as Kaduna State’s House of Assembly.

In addition to being the political capital of the North, Kaduna soon developed into a pre-eminent center of media ( Broadcasting Company of Northern Nigeria, New Nigerian and the defunct Today, Hotline, Democrat, Citizen and Reporter) and of commerce and industry in the region and in Nigeria. These developments started in 1957 as the city became the most important hub of the country’s railway network connecting Lagos to Kano, Port Harcourt to Maiduguri and Baro, the country’s then biggest and busy inland port on River Niger.

The Arewa House lies on twenty acres of beautifully wooded land with equally beautiful landscape in the quiet neighbourhood of the former Ministers’ Quarters. It is located on No. 1 Rabah Road, on the grounds of the official residence of Sir Ahmadu Bello, the regional premier who was assassinated in the first military coup in the country.

Apart from the Arewa House, Kaduna has a large concentration of educational institutions including the Kaduna Polytechnic, possibly the largest in Africa, and the Nigerian Defence Academy, which doubles as a military training institution for officers of the Nigerian military and a degree awarding institution.

THE IMPACT OF INFRASTRUCTURE CONDITION ON RENTAL VALUE OF COMMERCIAL PROPERTIES IN MINNA NIGERIA

THE IMPACT OF INFRASTRUCTURE CONDITION ON RENTAL VALUE OF COMMERCIAL PROPERTIES IN MINNA NIGERIA

CHAPTER ONE

INTRODUCTION

1.1       BACKGROUND OF THE STUDY

Investments in infrastructural facilities do contribute immensely to the population growth of metropolitan cities of a nation. Good quality roads, railways, airport, educational institutions, security of life and properties and hospitals are essential for the smooth running of the economic sectors in a developing world. In many countries and for many years, economists, planners and surveyors have tried to provide answers to why economic growth is faster in some regions than others and why some cities grow faster than others.

With the availability of major investments in infrastructure of any city, there would be automatic population increase that would influence massive property development. It has been argued by Ogunba (1999) and Ighalo (1986) that rural-urban migration, rising purchasing power and demographic factors such as changes in the average family size are contributory factors to urban growth. 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.

Many scholars have attempted in varying ways to define or explain the meaning and concept of the term “infrastructure”. Notwithstanding the fact that it is not the intention of this paper to explore or examine the myriad of definitions, the National Research Council of the United States of America captured to a very great extent the totality of the term as referring to “both specific functional modes – highways, streets, roads and bridges; mass transit; airport and airways; water supply and water resources; waste water management; solid waste treatment and disposal; electric power generation and transmission; telecommunication and hazardous waste management – and the combined system these modal elements comprise. According to Okoronkwo and Ezeh (2012) cited in Okorafor et al, (2017), infrastructures are not the things with which nature has endowed man, but the profitable conversion of these natural resources for the advancement of the society and benefit of man. Rainfall for instance is a natural gift from God. It is not an infrastructure. It becomes one when man technically conserves this gift and develops it to serve as regular and functional water supply for agriculture, industries and for domestic uses.

Infrastructural decay occasioned by the neglect has bedevil most of our towns and cities in Niger State, Nigeria. The scenario is not perhaps totally different from what is tenable in other states of the federation. The term infrastructure refers to all the physical, social and economic elements needed to support the population, in addition to other municipal services which include sewer, water supply, natural gas and electric services, schools and police stations, roads, airports, etc. As society develops, the need to provide basic infrastructure for the wellbeing of their inhabitants arises. Most of the Infrastructure are capital intensive in the procurement and perhaps also in their maintenance, and these services are usually provided by the different levels of government in the federation although private sector participation is now gradually becoming noticeable due to the liberalization policy of some aspect of the national economy by the present administration.

Infrastructural development refers to the bringing into existence of the basic amenities and services which must be in place for a particular activity or pursuit. However, no nation can boast of significant development or an enhanced economy without providing the basic Infrastructure for the citizens’ well-being. In Nigeria, sale prices of properties vary for different suburbs due to their attributes. For people who live in urban areas or cities, infrastructure decisions may be influenced by the balancing of desires and the environments.

Therefore, infrastructure is discussed as a key influence in explaining property price dynamics. Minna metropolitan area was chosen for the study to evaluate the effect of established infrastructure and location amenities on commercial property values. The adequacy of infrastructure helps to determine the level of success that a country achieves in terms of coping with population growth, reducing poverty, or improving environmental conditions (World Bank, 1994). One veritable parameter of assessment and indicator of status of any spatial, especially urban system is the state of infrastructure. The efficiency of any form of human activity system including an urban area largely depends on the provision of efficient infrastructural facilities and services (Babarinde 1998). Hence the significance of infrastructure in the proper functioning of an urban area cannot be dismissed. Apart from being a major pointer of environmental quality, urban infrastructure is a critical socio-economic development of any urban area (Okusipe 1999).

It places an important and indispensable role in the economic, social and environmental aspect of life of an urban setting. It has a pronounced impact on the quality of life. It is a back bone of any economy. Industry needs it to effectively and efficiently drive their production processes. It is evident that a myriad of factors such as the prevailing economic conditions, government legislation and policies, availability and state of infrastructural provision come into play to influence commercial landed property (values). In carrying out this study, all other factors were assumed constant while urban infrastructure was isolated and examined in relation to commercial property values. Hence this study will assess the impact of infrastructure condition on rental value of commercial properties in Minna, Nigeria.

1.2       Statement Of The Problem

The impact of infrastructural facilities in property market is very crucial. The fact remains that property units are fixed in location, they however differ in terms of their surroundings, neighborhood and the kind of community in which they are located. Considerable importance is attached in today’s world to property’s facilities as it influences the use and value of the property. Infrastructure and location has always been an important determinant of a property’s value. Many factors interplay to create property values. For commercial property, factors like accessibility, population, volume of trade patronage, adequate communication facilities, efficient transportation system and many other factors to be considered. Infrastructure and location may also be with the surrounding activities, and when these relationships are negative to the economic and social well-being of the property, such a property is said to have “Infrastructure and location obsolescence” and hence commands low rental value. Factors that negatively affect the value of real property, affects ownership’s goal or target income. They also cripple the investor’s interest by discouraging subsequent investment. Since facilities and location is considered as factors that may likely affect the rental value of commercial properties, and because commercial activities are very significant in strengthening the economic basis in our urban areas, therefore, playing important role in the socioeconomic development. This might also be the reason why most of the purposely built residential properties are being converted to commercial uses in our cities centers today. The primary objective of commercial properties is the derivation of financial gains, and, the demand for land is a reflection of the profitability or utility derivable from its use. The greater the benefit to be obtained from a particular use, the higher the rent that the user will be willing to pay for it. In Minna, there appear to be a wide range difference in the levels of rent passing on commercial properties in a particular areas and between different locations. Tenants are always faced with the fact that although, similar commercial properties commands different rental value within the same area, and also, when the properties are not situated in the same area or location, the rental value of same type of these commercial properties varies greatly. This study seeks to carry out an analysis of the impact of infrastructural condition on rental value of commercial property values in Minna. Minna is often seen as the urban city with the vilest infrastructure, inadequate storm drainage, and poor public water supply, garbage dumped on the road sides and non-existence or bad sewage system. The infrastructure of a city is a major determinant of the demand of commercial property. The infrastructure facilities in the study area affects the rate of commercial property demand in the area, this is because people will only buy or rent commercial property in areas were the infrastructure facilities development is sustainably available, this will help to enhance the economic and livability in the community. The impact between infrastructure and commercial property values has been the focus of many studies. Some of the earlier studies returned positive effect between infrastructure and commercial property values while others showed negative effect. Possible effect between infrastructure and commercial property values have therefore elicited the interest of the researcher in this direction. It is against this background that this study was conceived.

1.3       Aim And Objectives Of The Study

The aim of this study is to examine the impact of infrastructure condition on rental value of commercial properties in Minna, Nigeria. To achieve this aim the under listed objectives will be pursued.

1. To identify the types and state of infrastructural facilities available to the commercial properties in Minna.
2. To examine the adequacy of infrastructural facilities for commercial properties in Minna.
3. To identify the regularity, effectiveness and functionality of infrastructural facilities in different areas on commercial properties in Minna.
4. To analyze the rental values of shops and offices, as a result of infrastructural facilities in Minna.
5. To establish the effect of infrastructural facilities on commercial property values in Minna.

1.4       Significance of the Study

This project is an attempt to assess the impact of infrastructural condition on rental value of commercial properties in Minna, the study discuss the types of residential property in the study area, identifies the types and condition of available infrastructural facilities available and tries to establish the relationship between infrastructural facilities and commercial property rental value. The result of research will help developers, investors, real estate managers and valuers and the government to know the relevance of infrastructural facilities to commercial residential properties and its effect on rental value thus given them a better chance to an informed decision.

The study will 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.

This study will also serve as a reference material for subsequent research related to the effect of infrastructural facilities on commercial property value where researchers, students and scholars will tap into the wealth of knowledge provided in this study.

1.5       Scope and Limitations of the Study

The research work is confined to the study of the assessment of the impact of infrastructure condition on rental value of commercial properties in Minna. It deals with rental value of residential properties such as shops, offices, two bedroom flats and three bedroom flats which are the common types of commercial properties found in the study area.

There are several limitation encountered during the conduct of this research. These limitations include: non availability of adequate data which played a major limitation to this write up because of non-cooperative attitude of some respondents who were not willing to give information and data needed to aid findings, time was another major factor which affect the study as the researcher do not have enough time to make detailed investigation on all the aspects of the study. And the general unwillingness of some respondents to fill the questionnaire provided for the research made it difficult to gather data needed for this research study at the most appropriate time.

1.6       Operational Definitions of Terms

Commercial property: this refers to properties mainly developed and used for maximize rental income\profit. They are built to provide accommodation for business accommodation e.g. shops, offices, show rooms etc.

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 to 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.