{"id":9293,"date":"2019-08-31T05:34:38","date_gmt":"2019-08-31T05:34:38","guid":{"rendered":"https:\/\/amazingproperty.com.ng\/blog\/demand-for-nigerias-luxury-real-estate-dips\/"},"modified":"2019-08-31T10:37:54","modified_gmt":"2019-08-31T10:37:54","slug":"demand-for-nigerias-luxury-real-estate-dips","status":"publish","type":"post","link":"https:\/\/amazingproperty.com.ng\/blog\/demand-for-nigerias-luxury-real-estate-dips\/","title":{"rendered":"Demand for Nigeria\u2019s luxury real estate dips"},"content":{"rendered":"

\"Real<\/p>\n

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The Nigeria\u2019s luxury real estate<\/strong> market has taken a beating lately due to several fundamentals, which include stricter government regulations and economic factors.<\/p>\n

Developers\u2019 over-exuberance and government crackdowns to check money laundry in the real estate sector combined to end the selling frenzy and leave developers, lenders<\/a> and property investors battling to absorb the fallout. This backlash neccessiated high vacancy rates and drop in values to over 60 per cent.<\/p>\n

Recent investigations by The Guardian revealed that luxury home sales-or sale of homes priced above N150 million are worst hit and had continued in its downward slide. The sales response has been slow to non-existent.<\/p>\n

In the past four years, the high-end market have fallen on an annual basis, and peaked last year. This year, there has not been any sign that changes will come in the sector, according to real estate experts.<\/p>\n

The shift in the luxury market has been more pronounced, in Lagos, Abuja and Port Harcourt markets. Demand for high-end homes is waning in large part due to changes in government\u2019s tax policies and fears of security agencies\u2019 harassment, among other issues. The demand by Economic and Financial Crime Commission (EFCC) for estate surveyors and valuers to disclose large transactions has scared away investors. \u201cThis has created a situation where even those who have genuine funds<\/a> are unwilling to invest<\/a> in real estate for the simple reason that they do not want the commission snooping into their activities,\u201d according to a report by Ubosi Eleh and Company.<\/p>\n

According to the report, development of real estate for sale or lease has slowed down tremendously. While developers\u2019 expectation they could sell thousands of homes as investments to the wealthy have been dashed due to less return on investments. In fact, the number of new estates by developers has dropped to more or less a trickle because there is huge stock of unsold inventory of houses<\/a> from previous development.<\/p>\n

Developers indicate that whereas sales were undertaken at the rate of five units monthly about four \u2013 five years ago, now it is more like one unit per quarter. Experts believe that stricter government regulations, changes in exchange rates can also dissuade foreign buyers in the high-end real estate markets, as diaspora investors account for a substantial percentage of transactions.<\/p>\n

The Managing Director, Alpha Mead Partners, Erejuwa Gbadebo said: \u201cThere is a glut and most are priced beyond the pocket of the consumers.\u201d She listed<\/a> the challenges hampering the growth of the luxury as too many regulatory charges; over specification leading to over priced building materials<\/a> being used; poor state of the economy; no proper analysis of the market requirements leading to the wrong properties being developed for the current market; and difficulty in the ease of doing business leading to the down sizing of the firm\u2019s that would ordinarily take up such properties as well as over priced land.<\/p>\n

For the Chairman, Royal Institution of Chartered Surveyors (RICS), Gbenga Ismail, \u201cdemand for luxury property has fallen because it no longer has investment value. However only those who want to purchase as occupiers continue to be the only effective demand. Values have dropped by at least 50 to 60 per cent.<\/p>\n

\u201cYou will however find a contradiction in the Banana Island sub market.\u00a0Land prices have risen by 50per cent in 24 months because of the effective primary occupiers who have chosen this sub market as a preferred address.\u201dBut the Chairman, Nigerian Institution of Estate Surveyors and Valuers, Faculty of Estate Agency and Marketing, Sam Eboigbe is quite positive on the recovery of the market.<\/p>\n

He added that \u201csome locations have tremendously been subjected to high volume of activities resulting in upward movement of property values. The growing rate of insecurity and banditry contributed to the increase of activities in these areas offering amenities and comfortable lifestyles.\u201d<\/p>\n

\u201cCertain locations have tremendously been subjected to high volume of activities resulting in upward movement of property values. Apapa GRA has witnessed massive decline in property values.\u201d<\/p>\n<\/div>\n

Guardian <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Real estate The Nigeria\u2019s luxury real estate market has taken a beating lately due to several … Demand for Nigeria\u2019s luxury real estate dips<\/span>Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":3753,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[4],"tags":[4751,1403,15239,132,1398,1399,1330,62,12908,543,215,248,127,617,489,3836,684,3058,5763,522,679,41,818,84,567,2878,857,12],"class_list":["post-9293","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-opportunities-in-new-markets","tag-amazing","tag-buy","tag-chase","tag-commission","tag-developers","tag-development","tag-financial","tag-for-sale","tag-home","tag-home-buying-guide","tag-home-sale","tag-home-sales","tag-homes","tag-house","tag-houses","tag-insecurity","tag-lagos","tag-location","tag-luxury-real-estate","tag-nigeria","tag-nigerias-luxury-real-estate","tag-property","tag-real","tag-real-estate","tag-real-estate-for-sale","tag-real-estate-market","tag-real-estate-sector","tag-surveyor"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/04\/Real-Estate1.jpg?fit=1280%2C720&ssl=1","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/posts\/9293","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/comments?post=9293"}],"version-history":[{"count":1,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/posts\/9293\/revisions"}],"predecessor-version":[{"id":90973,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/posts\/9293\/revisions\/90973"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/media\/3753"}],"wp:attachment":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/media?parent=9293"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/categories?post=9293"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/tags?post=9293"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}