| Content | Abstract
This project work is on An appraisal of investors confidence and performance of the real estate sector in Abuja, Nigeria. The aim of this study is to appraise the level of investors’ confidence and performance of the Nigerian real estate sector. In attaining the aforementioned aim, this study is set to achieve the following objectives: identify the predominant types of investments/investors in Nigeria identify investors preference factors for other dominant investments in comparison with real estate ascertain the behaviour/attitude of investors towards the Nigerian real estate sector measure the level of confidence of investors to real estate investment in Gwarimpa, Abuja and to assess the performance of the Nigeria real estate sector. The study makes use of the survey design which enables the researcher to take close-ended study of the research population and obtain all the relevant information needed from respondents through the use of questionnaires, interviews, and personal observation. Statistical tools such as tables, percentages and descriptive methods were used to present and analyzed the data gathered from the field survey which was considered appropriate for the research. A total of one hundred questionnaires were distributed while 93 were duly filled and returned forming a 91% response rate. The study revealed that the common types of real estate investment in Gwarimpa are residential properties in different categories such as bungalow (detached/ Semi-detached), block of flats and duplex with the mean value of 3.50 and above and that the Nigeria real estate sector is performing well, however, a lot still desired to done by all stakeholders involved to ensure and more favorable environment. Finally, the study recommends that the Nigerian government should create incentives for the real estate sector so as to encourage more investors into the sector for the development of affordable housing for Nigerians. | CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND
Housing has a central importance to quality of life with considerable economic, social, cultural and personal significance. Though a country’s national prosperity is usually measured in economic terms, increasing wealth is of diminished value unless all can share its benefits and if the growing wealth is not used to redress growing social deficiencies, one of which is housing (Erguden, 2001). Housing plays a huge role in revitalizing economic growth in any country, with shelter being among key indicators of development (Ireri, 2010). The universal declaration of human rights gives one of the basic human rights as the right to a decent standard of living, central to which is the access to adequate housing (United Nations, The Human Rights – article 25, 1948). Housing as a basic human right demands that urban dwellers should have access to decent housing, defined as one that provides a foundation for, rather than being a barrier to, good physical and mental health, personal development and the fulfillment of life objectives (Seedhouse, 1986). The focus of this research is housing for low income households or what is commonly known as affordable housing. Affordable housing is a term used to describe dwelling units whose total housing costs are deemed "affordable" to those that have a median income. A median income refers to the average pay scale level of the majority people in a population which is often low. Although the term “affordable housing” is often applied to rental housing that is within the financial means of those in the lower income ranges of a geographical area, the concept is applicable to both renters and purchasers in all income ranges. Low-income housing is aimed at individuals without enough income to provide adequate housing for themselves and/or their families. These families are usually unable to purchase a home because they fail to qualify for a mortgage.
Housing is a major problem in Nigeria especially in Makurdi. Millions of people are living in the sprawling slums and also in other informal settlements. Informal settlements and slums in Makurdi have continued to grow at an alarming rate in number as well as in population. Table 1.1 shows the growth in informal settlements in Makurdi between the year 2011 and 2015.
Table 1.1 Growth in Informal Settlements in Makurdi.
| Year |
No. of informal
settlements. |
Population. |
% of urban population. |
| 2011 |
36 |
167,000 |
33 |
| 2012 |
50 |
200,000 |
40 – 50 |
| 2013 |
78 |
789,991 |
55 |
| 2015 |
134 |
1,886,166 |
60 |
Source: Benue State Urban Archives, 2015.
“Informal settlements” is a generic and technical term that seeks to capture the many different features of those settlements that house many of the urban poor in developing countries. The name implies the dominant feature of such settlements is their informality – the fact that they develop outside the existing legal and regulatory framework. The informal settlements are sometimes called “unplanned” or “spontaneous” settlements, which is misleading, since many informal settlements are planned, albeit not in a conventional way, and are not all spontaneous (World Bank, 2003). Demand for housing far surpasses its supply in Nigeria, especially in urban areas that have for long suffered from poor planning, resulting in an increase in informal settlements with poor housing and little infrastructure services. The housing market in Nigeria has over the years faced a huge supply challenge for both government and private sector players. With availability of about 35,000 housing units in urban areas, the deficit remains huge from a growing demand of 150,000 units every year (Terkula, 2010).
Despite some attempts at achieving decent housing for Nigerians, Nigeria has, on the whole, failed to address the dire housing conditions of her population. The situation has been partially alleviated through the activities of the private sector housing developers, who have been a key supplier of housing, particularly in Makurdi (Benue State Urban Archives, 2009). In the year 2010, the private sector commenced construction of housing units worth Kshs. 9.8 billion and registered growth of 6.9% over the previous year (Statistical Abstract, 2008). But despite intensive overall private-sector activity, these private developers have mainly concentrated in the middle and upper segments of the market with relatively little focus on the low-income market. The low income house units currently constitutes less than 30% of the private development portfolio (Economic survey, 2010), yet this is the segment where the need is particularly acute.
In the past, the government took up the role of housing supplier by controlling planning, land allocation, and development and maintaining housing estates. The government has being charged with the responsibility of providing subsidized housing and implementing government housing policies and programmes through tenant purchase, mortgages, rental and rural housing loan schemes. The National Housing Corporation was formed as part of Nigeria’s post colonial housing policy, underscoring the importance of providing decent shelter for all urban workers in the country (Benue State Urban Archives, 2009).
NGO’s have come in to fill in the gap in the housing shortage especially for the low income households. Banks also introduced loans to enable building of infrastures especially houses for rents and this NGO’s and private individuals are now engaged in a low cost housing development project for its members, and the public.
Other NGO’s involved in policy making and assisting developers in this sector include: National Urban Forum (Nigeria), African Ministerial Conference on Housing and Urban Development (AMCHUD). These housing developers focusing on the low income market cannot adequately meet the needs of the market unless more players from the private sector join in.
There are five models of housing development for low income housing initiatives (World Bank, 2011):
- Sites plus development plan and gradual implementation of services – settlements are planned and surveyed, lots allocated and occupied, and infrastructure gradually implemented.
- Sites and services – mass production of serviced sites in large schemes for resettlement of urban squatters, usually in peripheral land in city outskirts and with basic starter housing units.
- Comprehensive upgrading of existing settlements – wide range of improvements involving different types of infrastructure according to predefined area plan; this is integrated upgrading but undertaken in one go, usually in a two year time frame.
- Development of new housing in new settlement – new infrastructure and housing units are built on empty land; or new housing units on available land in existing serviced areas.
- Redevelopment of degraded existing structures – agreement reached with building landlords for building renovation.
The Rwanda government for example has adopted the model of developing new housing settlements for her population. They have initiated the Imidugudu project. Imidugudu is an 80 household settlement that was set up in 2002, to accommodate refugees who had returned mainly from Burundi. They are grouped settlements modeled along the lines of Israel’s Kibbutz. The model is being replicated in the whole of Rwanda to accommodate her population decently (Rwanda Report, 2010).
1.2 STATEMENT OF THE PROBLEM
Provision of adequate, affordable and decent housing for low income households is clearly in short supply. The players in this industry are too few and there seems to be a minimal interest of other private sector housing developers to provide low income housing units. These private sector developers as by their success in the middle and high income housing markets, implies that they may have the capacity and skill set to supply the low-income housing required to alleviate, at least partly, the housing shortfall in the country (Benue State Urban Archives, 2009). But they have shied away from the low income market mainly because the profitability margins are lower as compared to housing developments for the other markets.
There are also many other factors affecting the supply of housing from private sector housing developers prominent of which is the cost of production and the opportunity cost to the developer’s finite funds in either providing middle income housing or high income segment housing or low income housing. The developers have to consider the rate of return to their investment and how fast they’ll realize this. But these are not the only factors affecting the supply of low income housing and the other factors should also be put into consideration. Provision of low cost housing to the increasing number of lower and middle income classes in the country has also been hugely affected by the cost of land and inadequate infrastructure (Terkula, 2010).
The problem that this research seeks to address is that of the shortage in housing supply for low income households and the challenges faced by both existing and potential developers in this market. Issues to be addressed in this research study include the factors affecting low income housing supply, the motivating factor to existing developers in venturing into this market and the housing models they have adopted in their projects.
1.3 RESEARCH OBJECTIVES
The purpose of this study is to research on the factors affecting housing development for the low income market. It seeks to achieve the following objectives:
- To identify the motivation behind existent players in the industry whether profit, social or other.
- To analyze the housing model that has been adopted here in Nigeria by existing housing developers for the low income market.
- To examine the challenges faced by housing developers in the low income market and hindrances to their efforts.
1.4 LIMITATIONS OF THE STUDY
- The study involved the collection of primary data. There was a low response rate that is related to the collection of primary data. Some of the respondents did not bother to fill in the questionnaire within the specified period and claimed to be too busy to take time and participate.
- There lacked a credible listing which is comprehensive and up to date of property developers whose focus is the low income housing market.
- Since the measurement scale of the data collected was ordinal it did not lend itself to more robust methods of data analysis.
1.5 RESEARCH QUESTIONS
The research aims to answer the following key questions:
- What is the motivation behind existing players of housing development in the low income market?
- What are the housing development models that have been adopted in Nigeria for affordable housing projects?
- What are the challenges faced by the developers in the low income housing market?
1.6 HYPOTHESES
In order to enable the researcher assess the effect of rural development in combating rural urban migration in Nigeria, the following hypotheses will be tested:
- Ho: Housing for the poor, does not have any significant benefits to the poor, when built in Nigeria.
HA: Housing for the poor has significant benefits to the poor in Nigeria.
1.7 SIGNIFICANCE OF THE STUDY
The study will aid the government agencies in charge of putting up housing for the masses, especially for civil servants at various tiers of government, this will accelerate development in rural areas and urban areas .
This research study will also help reveal the extent of the problem to relevant stakeholders so that they can rise to the occasion and put in measures to the occasion and put in measures to develop the housing for the poor.
Finally, this research work will add to the existing body of knowledge on the importance of housing for the poor in Nigeria.
1.8 JUSTIFICATION AND SCOPE OF STUDY
This study will expose the challenges of housing development for the poor in Nigeria, with special reference to the actual causes of this problems, measures put in place by relevant stakeholders to combat the challenges in the study area are also looked into.
Therefore, it is important that housing for the poor should be a great focus for every government.
1.9 RESEARCH METHODOLOOGY
The study use two approach that have survey research methodology and the formation are;
- Content analysis for secondary data collection
- Survey research method for primary data collection.
1.10 DEFINITION OF TERMS AND CONCEPTS
Infrastructure: basic physical and organizational structure and facilities needed for the operation of a society or enterprise.
Challenges: The problems that are evident to a development .
Housing: The provision of accommodations for human inhabitation | CHAPTER ONE
BACKGROUND TO THE STUDY
1.1 Introduction
This study is on the role of the financial investors in housing provisioning in Nigeria. Housing as a social need is vital to socio-economic development of every country (Giddings, 2007). The housing Investors is generally accepted as one of the most important determinants of the economic and social wellbeing of people. It plays a key role in the lives of people as the provision of shelter is one of the basic necessities of man (Moss, 2010). The need to provide adequate housing cannot be over emphasized and its importance can hardly be exaggerated (IMF, 2011).
Derban et al (2002) indicate that the availability of adequate and decent housing enhances good living conditions and productivity of all individuals. It plays a vital role in the health, happiness and civilized living of the individuals. Housing does not only satisfy the physical and biological requirement of man but also upholds his dignity and improves his quality of life (NCH, 2008). The provision of housing is so linked with national economic development that the rate of house construction is directly related to the economic performance of a country (BoG, 2007).
Unfortunately, the provision of housing worldwide has not been able to meet demand (Ogu and Ogbuozobe, 2001). This lag can be attributed to the population surge which has more than doubled in numbers in recent times (Giddings, 2007). Most developing countries are confronted with the problem of accommodating the rapidly growing population especially in their urban areas and Ghana is not an exception (Konadu- Agyeman, 2001). The provision of adequate shelter is one problem that the country has had to contend with. The inadequate housing stock and the lack of basic housing requirements induces stress and affects the living condition of households as well as productivity( Derban et al,2002).
One of the major problems facing housing delivery in Ghana is finance. The unavailability and inaccessibility of housing finance mechanisms has been identified as one of the important hurdles in improving housing delivery in the country (Hoek- Smit, 1998).
There are two main sources of finance in the housing finance system (Moss, 2010). They are the formal and financial sources. The formal source consists of government budgetary allocation and financial institutions in the form of mortgages. The financial sources include personal/family savings, individual money lenders, and remittances from family members.
Over the years, government of Ghana through housing schemes and plans has found ways and means of financing housing in the country. The rationale for government intervention in the housing market revolves around the goal of providing all Ghanaians with a decent house in a suitable living environment (IFA, 1993). During the 1970‟s and the 1980‟s, the main focus of government housing intervention in the country was by embarking on mass housing projects for the citizenry with the government being the sole financier of the projects. Examples of some of these housing projects are the government built low and medium class estates for civil servants (Afrane and Asamoah, 2011).
Currently government plays a double role when it comes to financing housing delivery (IFA, 1993). The government plays a direct role through the construction of public/mass houses but it is mostly not realized due to the lack of funds, lack of coordination and policy abandonment due to change in government. The government also plays an indirect role by creating an enabling environment through tax policies which includes tax subsidies for real estate developers and subsidized interest rates for borrowers from financial institutions associated to housing finance (eg. Home Finance Company Ltd).
The liberalization of the housing market has facilitated the involvement of the private Investors in housing delivery (Sangore, 2003).The private Investors currently produces over 83 percent of the total housing stock in the country(Boamah, 2010).The private Investors is divided into formal and financial investors. The formal Investors includes the real estate developers and cooperative societies. These developers construct housing projects for individuals to purchase them but this approach mostly exempts the poor and the middle income earners due to the high cost of the houses. The formal Investors actors provide only a few thousand dwellings in a year (UN-Habitat, 2011).The financial Investors consists of individuals who engage in housing provision for themselves. Given the apparent trends in most of the developing countries, there are indications that the bulk of urban housing in these countries will continue to be produced by the financial Investors (Okpala, 1994; Ikejiofor, 1997). There is the need for efficient and effective housing finance systems for the financial Investors since finance plays a key role in housing delivery.
1.2 Problem Statement
The Ministry of Water Resources, Works and Housing asserts that in order for the nation to remove the housing deficit of 1.7 million, the national housing production should be 170,000 units annually (MWWH, 2013). However the current supply capacity of the nation is in the region of 42,000 units per year (Afrane and Asamoah, 2011). Demand for housing in Ghana is higher in the three major urban areas; which are Accra, Nigeria and Sekondi-Takoradi (UN-Habitat, 2011). The Nigeria Metropolitan Assembly estimated that the total housing stock in Nigeria as of 2009 was 83, 693 (KMA, 2010) and this was distributed fairly amongst the ten sub metropolitan councils. The housing deficit in Nigeria Metropolis is startling since the total number of houses as of 2010 compared with the number of households indicated acute overcrowding in most houses (KMA, 2011). This constitutes a major problem and calls for an urgent need to address the situation.
Even though the financial Investors is by far the largest housing supply system in most urban areas, it has not been able to meet the increasing demand for housing partly as a result of the inadequate and ineffective financial mechanisms for financing housing in the country (Moss, 2010). Finance is crucial to housing by the financial Investors and lack of access to financial resources is a major problem facing this Investors (Ogu and Ogbuozobe, 2001).
In Ghana, very little is known about how homeowners finance the construction of new housing but it is however known that few homeowners have access to formal finance. This is because upfront finance is not easily accessible to allow them to purchase a higher quality home and pay for it over a longer and suitable period (Wapwera,et al,2014). This has resulted in most people financing through their personal savings but mobilizing savings and channeling them to finance housing projects has proven very difficult due to the type and nature of the jobs of the people in the financial Investors. They mostly do not have job security to enable them to save consistently. Personal savings also have had to compete with other household expenses making it extremely difficult (Ferguson and Smets, 2009).
Moreover, financial institutions are cautious about lending to the individuals thereby making access to credit facilities very difficult (Hoek-Smit, 1998). They provide very little support to low and moderate households in the form of mortgages. Some only provide mortgage loans for a small proportion of newly constructed houses and home purchases (Hoek-Smit, 1998).But even these financial institutions have made very little progress in this regard. Financial institutions mostly do not want to consider long-term lending for housing a priority because of the associated risks involved in the jobs of the financial Investors. These risks include insecure and undocumented incomes and the lack of collateral on the part of the private individuals (Hoek-Smit, 1998).The limited access to finance has partly led to the development of slums and squatter settlement and poor housing conditions.
The study focused on housing finance by the financial Investors. The financing options available to them and how they accessed funds for their housing projects and what can be done to improve their efforts in housing delivery in Nigeria Metropolis.
1.3 Research Questions
- What are the housing finance arrangements used by the financial Investors in Nigeria?
- What are the housing finance mechanisms that provide access to housing credit facilities to the financial Investors?
- What factors hinder access to housing credit to the financial Investors?
- What financial system can be put in place to improve access to housing finance by the financial Investors?
1.4 Research Objectives
The main objective is to have a comprehensive understanding of the housing finance practises by the financial Investors in Nigeria. The specific objectives are:
- To know the different types and characteristics of housing finance mechanisms available to the financial Investors in Nigeria.
- To determine the major housing finance mechanism used by the financial Investors and how it affects housing delivery.
- To identify the factors that hinder the financial Investors from access to formal housing credit facilities.
- To make suggestions for the improvement of access to formal housing finance by the financial Investors.
1.5 Scope
Geographically the study is focused on Nigeria, the second largest city in Ghana after the national capital, Accra in terms of population, social life and economic activities. Nigeria is the capital of the Ashanti region. It covers an area of approximately 254 sq. km. (GSS, 2005) with a population of 2,035,064 (GSS, 2012). The Nigeria Metropolis is made of ten sub metropolitan areas with each having its own unique housing characteristics. Nigeria as at 2009 has an estimated housing stock of 83,693(KMA, 2010) growing at 2.4 percent per annum.
Contextually, the study was on housing finance by the financial Investors in Nigeria. It looked at the housing finance mechanisms used by the financial Investors and the factors that hindered their access to formal credit facilities. The focus was on residential housing units with emphasis on private individual ownership.
1.6 Methodology
The study adopted a cross-sectional design as a research approach and relied on both secondary and primary data sources. The simple random technique was used to select the ten communities from the ten sub metropolitan areas whilst the purposive and convenience sampling techniques were used in selecting the institutions and homeowners respectively.
The units of analysis were residential home owners, officials of the Ministry of Water Resources, Works and Housing, SSNIT, some financial institutions (HFC Bank Ltd, Ecobank, UBA) and the planning and statistical department of Nigeria Metropolitan Assembly. (For more on the methodology, see chapter three of the report).
1.7 Significance of the Study
The demand for housing in the country is very worrying and alarming. The Ministry of Water Resources, Works and Housing estimates that the country needs about 170,000 housing units annually but is able to produce just 35 percent of that total number. Meanwhile GREDA also asserts the nation is able to produce only 42,000 units per year from the required annual 130,000 units (Afrane and Asamoah, 2011). These two assertions show that the country has an annual housing deficit that needs to be tackled.
Housing finance is a major problem in housing delivery in the country. Although the financial Investors plays a very key role in housing delivery, it has very limited access to credit facilities due to the nature of their jobs. This has led to sub standard construction of housing units, overcrowding in housing units, poor housing conditions and the emergence of slums and squatter settlements.
The study therefore gives more insight into how the financial Investors finance housing in Nigeria and the housing finance mechanisms available for them and also make suggestions to the most appropriate housing finance mechanisms for the financial Investors to improve housing delivery. The study helps to know how best the financial Investors can access housing finance mechanisms fully in order to improve the housing situation in the Nigeria Metropolis.
1.8 organization of the Study
The report is organized into six chapters. Chapter One of the report covered the general introduction to the study. It gave insight into the objectives, scope and significance and methodology of the study.
Chapter Two discussed the literature on the practical aspect and the various concepts of the study. This literature gave more insight into the housing finance systems pertaining in both the developed and developing countries.
Chapter Three discussed the methodology of this study. The chapter provided theoretical understanding of data collection techniques that were used and further explained how these techniques were applied.
Chapter Four looked at the profile of the study area. It provided a detailed background of the study area which included the history, physical and demographic characteristics and the housing situation in the Nigeria Metropolis.
Chapter Five focused on the analysis and presentation of the data collected from the various stakeholders involved in the study. The data collected were presented in tables, charts and diagrams.
Chapter Six was the final chapter and presented the summary of findings, the conclusion and recommendations to address financial Investors housing finance challenges in the Nigeria Metropolis.
1.9 Chapter Overview
The chapter gave a general introduction to the study. It looked at the objectives of the study, the research questions and the significance of the study. It also gave a brief introduction to the methodology that was used in the study. This allowed relevant literature on the study to be discussed in the next chapter. | CHAPTER ONE 1.0    INTRODUCTION 1.1    BACKGROUND OF THE STUDY Shelter is a basic necessity in life. An individual can satisfy this need by either occupying his own (owner’s occupier) property or renting another person’s property. In our traditional society, the need for shelter is mainly met through the first alternative that is owner occupation. With the emergency of urban centers’, the situation has changed. Many people are no longer about to own property because of the difficulty in the acquisition of land and the high cost of building construction. Therefore, they are left with the alternative of renting other people’s properties in order to satisfy their need for shelter. Consequently two classes of urban resident have emerged, the landlord and the tenant under this arrangement the tenant pays to the landlord a certain amount of money in consideration for his use of the landlord’s house. This amount is popularly known as rent. During the civil war the Nigeria that is 1966 to 1970 many landed properties in the urban areas of the former Eastern Region of Nigeria, including Enugu, were destroyed. Consequently, there was a sharp decline in the supply of landed properties after the war. Furthermore, the post – civil war period witnessed an unprecedented number of the rural population trooping into the urban centres due to the conspicuous prosperity brought about in the urban area by the oil boom. This resulted  to  high  demand  for  the  existing  limited  supply  of  landed  properties. Consequent upon these, rent for landed properties increased considerably. This trend has continued with the effect that “the average worker is paying 30% to 40% of his salary as rent†(Oshadiya, 1985). Thus the increase in rents on the properties has led to the variation of rent on properties. In urban area due to location advantage (for example prime location) which some properties offer above others for commercial and residential uses, rent tend to very on account of the type of use which a property can offer. 1.2    STATEMENT OF PROBLEM Location of economic properties has been a difficult concept to understand. Although the primary objective of commercial properties is the derivation of financial gains, while that of residential properties is for habitation, shelter and comfort, 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. There appear to be wide ranging differences in the levels of rent passing on residential and commercial properties in Enugu and Nigeria generally. This research is seeking among other things to find out the causes of rental variation in commercial and residential properties in Nigeria, Ogui New Layout and G.R.A as a case study. 1.3    AIM AND OBJECTIVES OF THE STUDY The main aim of this research is to examine the reasons for rental variation in commercial and residential properties with a view to provide tool to be used in catching issues related to rent on these properties in Enugu and Nigeria generally. To achieve the standard goal, the following objectives are to be pursued; - i) To identify the level of rents for commercial and residential properties in the study
- ii) To ascertain and examine the factors influencing the rents being commanded by these properties.
iii)    To determine or examine whether the income of prospective buyers/tenants affect their decision to acquire properties. - iv) To ascertain  if  there  is  disparity  in  rental  values  for  residential  and commercial properties in the study
- v) To find  out  the  rate  of  demand  between  commercial  and  residential properties?
1.4Â Â Â RESEARCH QUESTIONS - i. What is the level of rent for commercial and residential properties in Ogui
New Layout and G.R.A respectively between years 2002-2004? - ii. What are the factors influencing rents passing on those commercial and residential properties.
iii.    Does the income of prospective buyers/tenants affect their decision to acquire properties? - iv. Is there any disparity in the rental value or rent passing on residential and commercial properties in the study area?
- v. Amongst properties put for Commercial and Residential use, which is on a higher rate of demand?
1.5     SIGNIFICANCE OF THE STUDY The finding of this study will be of benefit to the following groups; Firstly, tenants who are charged rents based on different reasons, especially when the properties are of the same nature (physically). This will again enable the investors not only to understand how occupier thinks, but also why and the things they consider before acquiring properties for certain uses. Secondly, the generality of the public can now understand the reason why the rents being commanded by these properties have to differ. Lastly, this research work will help to determine the factors influencing, commercial and residential properties which is an essential pre-requisite to successful development as well as stimulating interest in the students to carryout out further research on the topic. 1.6    SCOPE OF THE STUDY The study covers a period of three years (2002 to 2004) and it is restricted to selected properties (Residential and commercial) comprising blocks of flat and tenements in Ogui New Layout and G.R.A, Enugu. 1.7    LIMITATIONS OF THE STUDY Expectedly, this work met with some hindrances during the stage of data collection. The issue of rent passing on a property (residential or commercial) is usually regarded as classified information, which is not easily disclosed to people particularly researchers. This was largely suspected to be the reason why some Estate surveyors, property owners, tenants, Estate firms, property companies and even Estate agents who were approached through oral interviews, discussions and visitations found it rather difficult to reveal essential information despite every explanation that the exercise is strictly for academic purposes, a good number of them, still nursed the fear that it may be for property rating and taxation purposes. | ABSTRACT Abandonment of development projects (ACP) is considered one of the most common and serious problems plaguing the Abuja development industry given the number and the value of the projects involved. It affects not only the immediate purchasers but also other project players and the general public. Sometimes it also involves expending public fund to revive abandoned projects. Yet, research is scarce on this issue; hence this research was conducted to investigate  the  problems.  Firstly the  issues  surrounding  the  problem  and existing literature on the causes of ACP are reviewed. Then, potential causes of ACP are also reviewed and summarized into 41 items to be rated in an industry wide questionnaire survey. The questionnaire also includes an open-ended question on suggestions to solve ACP. 225 questionnaire responses were received. Subsequently, a series of ten semi-structured interviews were conducted to obtain detailed opinions from experienced players in the industry concerning  the  causes  of  ACP  and  how  to  solve  the  problems.  The interviewees include architects, developers, property consultants, the honorary secretary general of the National House Buyers Association etc. to ensure a comprehensive view was obtained. Quantitative analyses include ranking of the 41 potential causes of ACP with Spearman‟s ranking correlation between different groups of respondents, and factor analysis with Cronbach’s α reliability analysis. Qualitative analyses include organizing into themes the results of the open ended question on solving ACP and the results of the semi- structured interviews. Discussions include interpreting the underlying factors extracted from factor analysis in light of the qualitative results. The results show the owner to be mainly responsible for ACP (i.e. cash flow problems, incompetence,  siphoning  out  of  money,  etc.),  followed  by  the  role  of government regulations. A risk management expert system module within BIM, a middle ground solution between the sell-then-build and build-then-sell schemes, and others are proposed. | ABSTRACT Abandonment of development projects (ACP) is considered one of the most common and serious problems plaguing the Abuja development industry given the number and the value of the projects involved. It affects not only the immediate purchasers but also other project players and the general public. Sometimes it also involves expending public fund to revive abandoned projects. Yet, research is scarce on this issue; hence this research was conducted to investigate  the  problems.  Firstly the  issues  surrounding  the  problem  and existing literature on the causes of ACP are reviewed. Then, potential causes of ACP are also reviewed and summarized into 41 items to be rated in an industry wide questionnaire survey. The questionnaire also includes an open-ended question on suggestions to solve ACP. 225 questionnaire responses were received. Subsequently, a series of ten semi-structured interviews were conducted to obtain detailed opinions from experienced players in the industry concerning  the  causes  of  ACP  and  how  to  solve  the  problems.  The interviewees include architects, developers, property consultants, the honorary secretary general of the National House Buyers Association etc. to ensure a comprehensive view was obtained. Quantitative analyses include ranking of the 41 potential causes of ACP with Spearman‟s ranking correlation between different groups of respondents, and factor analysis with Cronbach’s α reliability analysis. Qualitative analyses include organizing into themes the results of the open ended question on solving ACP and the results of the semi- structured interviews. Discussions include interpreting the underlying factors extracted from factor analysis in light of the qualitative results. The results show the owner to be mainly responsible for ACP (i.e. cash flow problems, incompetence,  siphoning  out  of  money,  etc.),  followed  by  the  role  of government regulations. A risk management expert system module within BIM, a middle ground solution between the sell-then-build and build-then-sell schemes, and others are proposed. |
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