{"id":14143,"date":"2022-11-20T21:53:14","date_gmt":"2022-11-20T21:53:14","guid":{"rendered":"https:\/\/amazingproperty.com.ng\/blog\/developers-experts-foresee-tough-times-for-real-estate-sector-as-foreign-exchange-rate-rises\/---c73fab4e-c061-43b7-97fd-c905411cc34c"},"modified":"2022-11-20T21:53:34","modified_gmt":"2022-11-20T21:53:34","slug":"real-estate-sector-foresees-hard-time-as-dollar-rate-move-up","status":"publish","type":"post","link":"https:\/\/amazingproperty.com.ng\/blog\/real-estate-sector-foresees-hard-time-as-dollar-rate-move-up\/","title":{"rendered":"Real estate sector foresees hard time as dollar rate move up"},"content":{"rendered":"

 <\/p>\n

\"Real<\/p>\n

\n

Property developers and experts have warned that real estate sector would be worst hit, if the situation persists.<\/h2>\n

Following persisting unfavourable policies and a full-blown foreign exchange rate crisis that has brought Nigeria\u2019s economy to a halt, property developers and experts have warned that real estate<\/a> sector<\/strong> would be worst hit, if the situation persists.<\/p>\n

Apart from the effects on construction cost variations on projects that may force investors to shift completion, a significant part of the nation\u2019s labour force in building and construction industry, mostly artisans from neighbouring countries such as Togo, Benin Republic and Ghana, may leave in droves.<\/p>\n

They said this will further compound housing<\/a> affordability of average Nigerians, whose purchasing power has been eroded by the depreciated value of the naira.<\/p>\n

However, it should be expected that Nigerians, both at home and in Diaspora, in possession of United States of America dollars would take advantage of naira depreciation to buy existing property stocks before price adjustment.<\/p>\n

The Managing Director, Affordable Housing<\/a> Limited, Yemi Adelakun, said the depreciation of the naira would have far reaching impact on real estate.<\/p>\n

\u201cCost of building materials<\/a>, especially imported ones, will increase and this will be passed on to off-takers as higher prices of real estate.<\/p>\n

\u201cAlso, existing projects may suffer some setbacks including delays or outright project abandonment because of naira depreciation. Similarly, new housing projects will be impacted depending on source and currency of funds<\/a>. Furthermore, the attraction of real estate investment<\/a> as a store of value may be impacted negatively by the free fall of naira,\u201d he said.<\/p>\n

President, International Real Estate Federation (FIABCI-Nigeria), Mr. Adeniji Adele blamed the crisis on bad implementation of various government policies over the years as a result of double standards and inconsistency.<\/p>\n

He said: \u201cThe market react negatively to the continuing rising exchange rate, which had affected cost of building materials and labour in the built environment. So real estate pricing<\/a> will never be the same again.<\/p>\n

\u201cThe market price has gone up, while cost of borrowing is higher and financial institutions are not willing to lend to grow real estate stock as they prefer to advance facilities on short term basis.\u201d<\/p>\n

President, Real Estate Developers Association of Nigeria (REDAN), Alhaji Aliyu Wamakko, explained that some building materials are not manufactured locally and any fluctuation in naira will impact on prices in the building materials\u2019 markets.<\/p>\n

He heaped the blame on the rise of the foreign exchange rate and inconsistent monetary policies. Wamakko said bureau de change should be allowed to operate side by side with banks. \u201cIt is better to arrest the situation before it goes out of hand,\u201d he said.<\/p>\n

The REDAN president, who called for price control board to regulate prices of commodities, foresees an increase in housing prices, if the rise in foreign exchange rate is not checked. \u201cIt is what we put into the buildings, we will sell. It is consumers that it will affect,\u201d Wamakko added.<\/p>\n

According to Adele, the housing market may not change substantially as people are already giving up in view of insecurity, unstable monetary policy, lack of attention to the real sector of economy, corruption, high cost of building materials as well as lack of access to land and other bureaucracies from government.<\/p>\n

He said: \u201cGovernment needs to be sincere with the citizens at all levels. The average low-income group may not be able to have access to own homes in the future. Social housing policy should be embedded in the present housing policy, as it is the practice in other developing countries.<\/p>\n

\u201cThe government should support and encourage private developers to access land at zero cost and work out a model that will be on win -win situation.<\/p>\n

\u201cThe real estate development would grow if all stakeholders were faithful and upright in the implementation of policies as well as encouraging locally manufactured building materials to further auguments imported and luxury products.\u201d<\/p>\n

To ameliorate the impact of foreign exchange fluctuations, Adelakun urged government in the short term to grant subsidies and waivers for affordable housing projects and building materials imports respectively.<\/p>\n

\u201cLow interest or no interest housing loan<\/a> for offtakers will be a welcome intervention. Long-term measures by government to reduce impact of exchange rate fluctuations should include promotion of domestic production of building materials as well as fiscal and monetary policies to stabilise naira,\u201d he added.<\/p>\n

Adelakun predicts that the luxury market will continue to thrive. \u201cMost buyers in this market pay outright for real estate and may indirectly benefit from the depreciating naira by tapping into their dollar reserves. Those pricing luxury real estate may have made provisions for foreign exchange fluctuations.<\/p>\n

\u201cSome are priced and paid for in U.S dollars. Price variations may emerge in some new and on-going projects.mart building developers import their building materials before commencing development to minimise impact of foreign exchange fluctuations.\u201d<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

  Property developers and experts have warned that real estate sector would be worst hit, if … Real estate sector foresees hard time as dollar rate move up<\/span>Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":14183,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"jetpack_seo_schema_type":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[4,527],"tags":[1238,4751,518,3107,1403,2890,1398,1399,12908,543,127,344,3111,3114,1442,3836,3117,3120,3099,5763,522,41,3126,818,84,3105,3096,3106,3113,3115,116,3103,3098,3108,3100,3109,3094,3093,3122,3095,3104,3102,3097,857,3116,3119,3112,3121,3110,3101,3118],"class_list":["post-14143","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-opportunities-in-new-markets","category-realestate","tag-affordable-housing","tag-amazing","tag-america","tag-best-real-estate-quotes","tag-buy","tag-construction","tag-developers","tag-development","tag-home","tag-home-buying-guide","tag-homes","tag-housing","tag-how-is-real-estate-market-in-florida","tag-how-much-does-it-cost-to-start-a-real-estate-business","tag-in-housing","tag-insecurity","tag-is-houston-a-good-place-to-invest-in-real-estate","tag-is-real-estate-a-good-business","tag-is-real-estate-market-going-to-crash","tag-luxury-real-estate","tag-nigeria","tag-property","tag-property-developers","tag-real","tag-real-estate","tag-real-estate-business-card-quotes","tag-real-estate-business-how-to-start","tag-real-estate-industry-jobs","tag-real-estate-industry-news","tag-real-estate-industry-worth","tag-real-estate-investment","tag-real-estate-market-hawaii","tag-real-estate-market-houston","tag-real-estate-market-in-2021","tag-real-estate-market-in-austin","tag-real-estate-market-in-calgary","tag-real-estate-market-in-florida","tag-real-estate-market-in-las-vegas","tag-real-estate-market-in-nigeria","tag-real-estate-market-in-nyc","tag-real-estate-market-in-toronto","tag-real-estate-market-new-york","tag-real-estate-market-new-york-city","tag-real-estate-sector","tag-real-estate-sector-etf","tag-real-estate-sector-performance","tag-real-estate-sector-stocks","tag-what-is-real-estate-industry","tag-whats-real-estate-business","tag-will-real-estate-market-crash","tag-will-the-real-estate-market-go-down-in-2022"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2021\/09\/Real-estate-sector.jpg?fit=400%2C300&ssl=1","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":7601,"url":"https:\/\/amazingproperty.com.ng\/blog\/lagos-plans-to-reduce-fraud-in-real-estate-sector\/","url_meta":{"origin":14143,"position":0},"title":"Lagos plans to reduce fraud in real estate sector","author":"Amazing Property","date":"December 25, 2017","format":false,"excerpt":"Faced with concerns on the activities of land grabbers, Lagos State government has pledged to bring to the barest minimum illegal and fraudulent activities in the real estate sector. Lagos Commissioner for Housing, Prince Gbolahan Lawal, who disclosed this at the second Real Estate Stakeholders\u2019 Forum in Ikeja, said the\u2026","rel":"","context":"In "Opportunities In New Markets"","block_context":{"text":"Opportunities In New Markets","link":"https:\/\/amazingproperty.com.ng\/blog\/category\/opportunities-in-new-markets\/"},"img":{"alt_text":"Prince Gbolahan Lawal.jpg","src":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/12\/Prince-Gbolahan-Lawal.jpg?fit=640%2C361&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/12\/Prince-Gbolahan-Lawal.jpg?fit=640%2C361&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/12\/Prince-Gbolahan-Lawal.jpg?fit=640%2C361&ssl=1&resize=525%2C300 1.5x"},"classes":[]},{"id":9737,"url":"https:\/\/amazingproperty.com.ng\/blog\/why-were-regulating-estate-agency-by-lagos-official\/","url_meta":{"origin":14143,"position":1},"title":"Why we\u2019re regulating estate agency, by Lagos official","author":"Amazing Property","date":"December 8, 2019","format":false,"excerpt":"Permanent Secretary, Ministry of Housing, Mr Wasiu Adedamola Akewusola (left); Special Adviser to the Lagos State Governor on Housing, Mrs Toke Benson- Awoyinka, Lagos State Governor, Mr. Babajide Olusola Sanwo-Olu, and the Commissioner for Ministry of Housing, Moruf Akinderu-Fatai during a Stakeholders\u2019 Engagement on Real Estate\/Agency Business held in Victoria\u2026","rel":"","context":"In "RealEstate"","block_context":{"text":"RealEstate","link":"https:\/\/amazingproperty.com.ng\/blog\/category\/realestate\/"},"img":{"alt_text":"Lagos.jpg","src":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2019\/12\/Lagos.jpg?fit=1200%2C674&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2019\/12\/Lagos.jpg?fit=1200%2C674&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2019\/12\/Lagos.jpg?fit=1200%2C674&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2019\/12\/Lagos.jpg?fit=1200%2C674&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2019\/12\/Lagos.jpg?fit=1200%2C674&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":27203,"url":"https:\/\/amazingproperty.com.ng\/blog\/experts-predict-2-9-real-estate-growth-this-year-2022\/","url_meta":{"origin":14143,"position":2},"title":"Experts predict 2.9% real estate growth this year 2022","author":"Amazing Property","date":"January 11, 2022","format":false,"excerpt":"Real estate growth is projected at 2.9 per cent this year 2022 this should increase the sector\u2019s contribution to the nation\u2019s Gross Domestic Product (GDP) \u00a0 Notwithstanding heightened uncertainty and affordability challenges, experts are optimistic of improvement in the sector this year. They anticipate opportunities, high demand and stable real\u2026","rel":"","context":"In "Opportunities In New Markets"","block_context":{"text":"Opportunities In New Markets","link":"https:\/\/amazingproperty.com.ng\/blog\/category\/opportunities-in-new-markets\/"},"img":{"alt_text":"real estate growth","src":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2022\/01\/real-estate-growth.jpg?fit=1080%2C811&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2022\/01\/real-estate-growth.jpg?fit=1080%2C811&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2022\/01\/real-estate-growth.jpg?fit=1080%2C811&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2022\/01\/real-estate-growth.jpg?fit=1080%2C811&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2022\/01\/real-estate-growth.jpg?fit=1080%2C811&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":5727,"url":"https:\/\/amazingproperty.com.ng\/blog\/stakeholders-to-chart-new-course-for-real-estate-sector\/","url_meta":{"origin":14143,"position":3},"title":"Stakeholders to chart new course for real estate sector","author":"Amazing Property","date":"August 14, 2017","format":false,"excerpt":"Babatunde Raji Fashola, Minister of Works, Power and Housing. All is set for stakeholders to deepen on-going discussions, stimulate measurable actions and provide the most inclusive to the housing issues in the country. They will meet at a two-day Nigeria Real Estate Summit and Expo (NIRESE) in Lagos, which will\u2026","rel":"","context":"In "Opportunities In New Markets"","block_context":{"text":"Opportunities In New Markets","link":"https:\/\/amazingproperty.com.ng\/blog\/category\/opportunities-in-new-markets\/"},"img":{"alt_text":"Fashola-BR.jpg","src":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/08\/Fashola-BR.jpg?fit=1200%2C675&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/08\/Fashola-BR.jpg?fit=1200%2C675&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/08\/Fashola-BR.jpg?fit=1200%2C675&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/08\/Fashola-BR.jpg?fit=1200%2C675&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/08\/Fashola-BR.jpg?fit=1200%2C675&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":6926,"url":"https:\/\/amazingproperty.com.ng\/blog\/sectors-experts-reiterate-call-for-long-term-real-estate-financing\/","url_meta":{"origin":14143,"position":4},"title":"Sector\u2019s experts reiterate call for long-term real estate financing","author":"Amazing Property","date":"November 6, 2017","format":false,"excerpt":"Housing experts have urged the federal government to boost the development of the real estate sector through improved long- term financing. They also noted that a paradigm shift in the current housing deficiency could only be witnessed if effective housing development and mortgage financing was put in place. Speaking at\u2026","rel":"","context":"In "Opportunities In New Markets"","block_context":{"text":"Opportunities In New Markets","link":"https:\/\/amazingproperty.com.ng\/blog\/category\/opportunities-in-new-markets\/"},"img":{"alt_text":"Real estate news","src":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/04\/Real-Estate1.jpg?fit=1200%2C675&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/04\/Real-Estate1.jpg?fit=1200%2C675&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/04\/Real-Estate1.jpg?fit=1200%2C675&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/04\/Real-Estate1.jpg?fit=1200%2C675&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/04\/Real-Estate1.jpg?fit=1200%2C675&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":9633,"url":"https:\/\/amazingproperty.com.ng\/blog\/operators-chart-course-for-real-estate-sector-urge-regulation\/","url_meta":{"origin":14143,"position":5},"title":"Operators chart course for real estate sector, urge regulation","author":"Amazing Property","date":"November 4, 2019","format":false,"excerpt":"Sanitising the estate sector, they said, will require collaboration between government and professionals in the built environment. 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