Professionals, experts, practitioners and veterans in the real estate sector have cried out, identifying the Land Use Act of 1976 as a major constraint to the survival of the real estate sector despite its capacity to generate billions of Naira and provide jobs for millions of Nigerians.
Some professionals joined stakeholders to call for the repeal of the law which has negatively affected the continuity and smooth running of investments, contracts, security of title, taxes, and fees across the country.
They lamented that factors such as the current legislation and various government policies, regulatory body, environmental laws were the major hindrances confronting the sector.
Professor Abel Olaleye of Department of Estate Management, Obafemi Awolowo University, Ile-Ife; Mr. Bode Ajisafe, Department of Urban and Regional Planning, University of Ibadan and Mr. Makanjuola Ojewumi an Estate Surveyor and Valuer identified provisions in the Land Use Act as the major problem confronting the professionals in the field.
While emphasising that the real estate sector alone contributed about 10.27% to the National Gross Domestic Product (GDP) growth in 2015, the trio maintained that the sector was no doubt one of the fastest growing sectors in the Nation.
They added that Nigeria’s real estate sector was growing at 8.7 % and is expected to rise further in the coming years as a result of growing population coupled with the increasing housing deficit.
They, however, pointed out that all efforts should be put in place to encourage the use of locally made products, building materials, encourage local investors and professionals.
The 2016 seminar organized by Nigerian Institution of Estate Surveyors and Valuers (NIESV), Oyo State branch with the approval of Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON) had the theme “Real Estate Investment Potentials for Wealth Creation in a Stringent Economy.”
Speaking on the topic “Issues in Real Estate Investment Potentials and Wealth Creation”, Professor Olaleye said “Our country’s land owning legal system, as governed by the Land Use Act is no doubt an impediment to real estate investing in Nigeria. This explains why stakeholders have at different forums, called for it to be repealed.”
“If our land registration and the titling system can be made favorable and less stressful for example, homeowners will be able to create wealth from their investments that are tied down in real estate capital in the name of home ownership”
“Our efforts should also be geared towards empowering local investors by given them access to large pool of fund from sources in the capital market. By doing this, local investors too will be able to have the financial muscle to compete with foreign investors in tapping into the real estate investment potentials”
“There will be the need for local experts and professionals to evolve extra skills and specialized training capable of meeting investors needs that will come with the investments in real estate.”
Ajisafe in his paper ‘Strategies for Financing Real Estate Investment Potentials in Nigeria’ while corroborating the first speaker decried the high-interest rate which had over the years had serious implications for property development in the country.
He said: “The mortgage interest rate in the country as at 2016 which is 17.9 is one of the highest if not the highest as compared to United Kingdom 1.24, United States of America 2.125, Canada 2.14, United Arab Emirate 3.24, Malaysia 4.5, China 4.5, India 9.45 and South Africa 10.5”
“Conditions attached to debt equity must also be made less stringent when taking cognizance of the reputation of the developer, suitability, and viability of the location and presence of off-takers.”
“The Government needs to consciously participate in the financing of real estate developments by providing cheap funds for on lending to developers. The development and use of local building materials should be encouraged. This will create massive employment, lower the cost of construction which will make life easier for real estate investors,” he said.
Ojewumi in his contribution titled “Creating Wealth from Real Estate investment Potentials: The Role of Estate Surveyors and Valuers”, remarked that all efforts must be put in place by the Government at all levels and relevant stakeholders to meet the housing deficit of millions of Nigerians.
The state NIESV chairman, Alhaji Rafiu Adegboyega Quardi said “Nigeria with mono-economy, relying on oil and with downward slide in its price globally and other areas should be fashioned out quickly to get out of recession, such areas of economic diversification include, Agriculture, Information Technology and more importantly through investment in real estate.”
Source: Leadership Newspaper