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Efforts at improving the nation\u2019s construction industry for the past few years may have suffered a setback, as property developers have recently seen an increase in the cost of materials shoot up building projects prices.<\/h2>\n
Efforts at improving the nation\u2019s construction industry for the past few years may have suffered a setback, as property developers<\/strong> have recently seen an increase in the cost of materials shoot up building projects prices.<\/p>\n Building firms and professionals currently witnessing slow transactions in the real estate<\/a> sector are now grappling with a 150 per cent rise in material prices caused by the depreciation of the naira and high exchange rates, according to an investigation by The Guardian.<\/p>\n Nearly 80 per cent of all materials used by the Nigeria\u2019s construction industry are imported and costs are expected to increase further as the exchange rate now\u00a0stands\u00a0at N506 to a dollar.\u00a0Experts are warning of dire consequences in the construction industry, if imports of building materials are left\u00a0entirely to the\u00a0vagaries\u00a0of free\u00a0market forces.<\/p>\n Similarly, local manufacturers of building materials such as cement, tiles<\/a>, paints and iron rods have also increased prices of their products due to\u00a0shortages of industrial fuel such as low pour fuel (LPFO), automotive gas oil (AGO) and natural gas.<\/p>\n There are fears that as building works get more expensive, homeowners may have to compromise on aspects of their project if some materials become too pricey \u2013 the cost of cement has already increased by 200 per cent,\u00a0iron rods by 120 per cent\u00a0and timber is up by 20 per cent. Prices of imported finishing products such as tiles, roofing sheets<\/a>, sanitary wares and doors have also hit the roof.<\/p>\n For instance, cement price, which increased from N1500 to N2,350, has now gone up to N2,600 in Lagos area;\u00a0the cost of rod has skyrocketed from N170, 000 per ton to N300, 000 and<\/p>\n The scenario has worsened government\u2019s projections to reduce the nation\u2019s housing<\/a> deficits, providing affordable housing<\/a> to the teeming population and encouraging homeownership through site and services schemes. Housing schemes by government agencies are now beyond the reach of average Nigerians.<\/p>\n Experts say, government must put in place policies that will lower materials costs.\u00a0\u00a0President, Nigerian Institute of Quantity Surveyors (NIQS), Mrs. Mercy Iyortyer who confirmed the development, noted that uncontrollable increase in the prices of construction materials<\/a> is a big challenge on project estimates in recent times; resulting in constant upward variations of construction costs and high costs of new projects.<\/p>\n As quantity surveyors continue to add value to clients by closely monitoring these increase and giving professional advise, Iyortyer called on government to urgently put in place policies that will lower and stabilize construction material prices to save the industry.<\/p>\n Also, President, Nigerian Institute of Building (NIOB), Tijani Shuaib said the high cost of building materials\u00a0has reduced the purchasing power of the prospective\u00a0clients, who patronize them as\u00a0estate developers.<\/p>\n Shuaib, who is an estate developers said: \u201cFor example, the cost of rod has skyrocketed from N170, 000 per ton to N300000, thereby making the price out of reach to people. The high interest rate from mortgage<\/a> is also a factor that even when the houses<\/a> are built, you cannot find buyers.<\/p>\n For majority of their members, who are civil servants and constitute 70 per cent of NIOB members, he said the increase is already impacting negatively on government owners occupier house scheme, which many leverage to own their homes. Many of them, he said, are backing out because they cannot pay the increase with the remaining number of service years.<\/p>\n President, Nigerian Institution of Structural Engineers\u00a0(NIStructE), Oreoluwa Fadayomi,\u00a0said the high cost of building\u00a0materials has impacted severely on\u00a0projects that\u00a0many\u00a0projects are\u00a0now\u00a0stalled and clients could no longer continue as a\u00a0result of high cost of all the\u00a0building materials.<\/p>\n In\u00a0some case where reinforcement is required the budget keep\u00a0increasing on weekly basis that many\u00a0developers decided to stop.\u00a0The resultant effect of this, he said\u00a0in ability to meet contractual\u00a0agreements in terms of repayment of credit facilities and payment of\u00a0salaries.<\/p>\n \u201cAnother dangerous trend is that many developers and engineers have resulted to cutting corners to ensure that they remain in business in\u00a0order to feed their families and make ends meet.\u00a0The resultant effect is that\u00a0proposed materials\u00a0may not meet\u00a0specified standards\u00a0due to high cost.\u201d<\/p>\n He cited instances, if you need 3O bags of cement to mix certain measurement\u00a0of gravel, you may need to reduce\u00a0to 15 bags in ensuring that projects are\u00a0not abandoned.<\/p>\n