REAL ESTATE RISK AND ITS IMPLICATION FOR PROJECT VIABILITY

REAL ESTATE RISK AND ITS IMPLICATION FOR PROJECT VIABILITY (A CASE STUDY OF EKEDO RESIDENTIAL ESTATE, UYO)

BACKGROUND TO THE STUDY

Real estate investing involves the purchase, ownership, management, rental and/or sale of real estate for profit. Improvement of realty property as part of a real estate investment strategy is generally considered to be a sub-specialty of real estate investing called real estate development. Real estate is an asset form with limited liquidity relative to other investments, it is also capital intensive (although capital may be gained through mortgage leverage) and is highly cash flow dependent (Syz, 2008). If these factors are not well understood and managed by the investor, real estate becomes a risky investment. The primary cause of investment failure for real estate is that the investor goes into negative cash flow for a period of time that is not sustainable, often forcing them to resell the property at a loss or go into insolvency. A similar practice known as flipping is another reason for failure as the nature of the investment is often associated with short term profit with less effort (Clayton, 2007).

Management and evaluation of risk is a major part of any successful real estate investment strategy. Risks occur in many different ways at every stage of the investment process. For instance mitigation strategy for fraudulent sale is to verify ownership and purchase title insurance. Real estate owners often assume risk on their property exposure in response to unavailability of coverage. While risk retention by ‑ financially sound companies may help to reduce their cost of risk, absence of insurance is not always desirable. In many cases, property owners are required under the terms of their loan covenants to maintain full insurance to value, with restrictions placed upon the amount of deductibles they may carry (Fisher, 2005). Additionally, under high-deductible or self-insurance programs, operating companies no longer have a budgeted premium, and payment of unexpected retained losses creates potential cash  flow problems. Finally, property owners or management of companies have no ability to charge the full cost of retaining property risk to their clients. Although real estate markets represent a large proportion of total wealth in both developing and developed countries, the real-estate derivatives markets are still lagging behind in volume of trading and liquidity with has greatly influenced project viability (Black, 1986). Over the last few years there has been increased activity in developing derivative instruments that can be utilized by asset managers to reduce real estate risk. The possibility of financial loss occurring as the result of owing a real estate investment and its implication on project viability will be focused on in this study. Real estate risk might arise from such things as liability, legal issues, partner problems that can force a sale, fire or theft, loss of rental income and purchasing property with an imperfect title.

1.2   STATEMENT OF THE PROBLEM

Real estate management is a particularly difficult challenge because of its tendency towards liquidity. Typically, even published indices in real estate are based on annual appraisals of large properties, not actual transactions. The recent unprecedented recession has resulted in major long term distress across the real estate industry, and has had severe implications for owners, developers, managers and investors alike. Environmental and construction exposures, catastrophic modeling, stricter lender requirements, and complex requirements involving distressed banks are just some of the risks facing the real estate industry. The researcher however will examine the real estate risks and its implication of project viability.

 1.3  OBJECTIVES OF THE STUDY The following are the objectives of this study:

To identify the risks involved in real estate investments. To examine the effect of real estate risk on project viability To identify ways to minimize risk in real estate investment.

1.4   RESEARCH QUESTIONS

What are the risks involved in real estate investments? What is the effect of real estate risk on project viability? What are ways to minimize risk in real estate investment?

1.5   HYPOTHESIS HO: real estate risk does not affect project viability HA: real estate risk does affect project viability1.6   SIGNIFICANCE OF THE STUDY The following are the significance of this study:

Result of this study will educate the general public, investors and estate managers on the real estate risks, how it can be minimized and its implication on project viability. This research will also serve as a resource base to other scholars and researchers interested in carrying out further research in this field subsequently, if applied will go to an extent to provide new explanation to the topic.

1.7   SCOPE/LIMITATIONS OF THE STUDY This study on real estate risk and its implication on project viability will cover all the risks an investor is exposed to in real estate with a view of understanding its effect on viability of project.LIMITATION OF STUDYFinancial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.REFERENCES Black, D., Success and Failure of Futures Contracts: Theory and Empirical Evidence, Monograph Series in Finance and Economics, Monograph 1986-1. New York University, 1986. Clayton, J. “Commercial Real Estate Derivatives: They‟re Here… Well, Almost.” PREA Quarterly, Winter 2007), pp. 68-71. Fisher, J. D., ‟New Strategies for Commercial Real Estate Investment and Risk Management‟, Journal of Portfolio Management, Vol. 32, 2005, pp. 154-161. Syz. Juerg M. Property Derivatives. (Wiley: Chichester, 2008).

REAL ESTATE INVESTMENT AND ITS ASSOCIATED CHALLENGES

REAL ESTATE INVESTMENT AND ITS ASSOCIATED CHALLENGES IN NIGERIA

BACKGROUND TO THE STUDY  

Real estate has continued to play a significant role in man’s evolution. It is not a coincidence that food, shelter and clothing believed to be the three essentials that sustain mankind, also have some linkage to land. Food grows out of land while shelter is affixed to it, and man’s clothing is made largely from what grows out of land. Indeed, whether in ancient times or today’s modern system, land constitutes a significant index for man’s wealth, and as economic activities have assumed more sophistication over time, land has continued to play a central role in their development (Lewis , 1994). There is hardly any business venture that does not require to be supported by some form of real estate: from the small business that requires real estate as offices from where its business can be organized, to the major venture that needs it for its factory.

Consequently, through some very robust and well thought out land policies comprehensively address challenges that are encounter in the real estate sector. This is not exactly the situation here in Nigeria and the result is that there is a myriad of problems in the real estate sector (Adewale, 2000). In the course of this study, the researcher will provide an overview of real estate investments in Nigeria and its associated challenges.

Real estate investment is intrinsically connected to the economic development and well being of any nation, thereby necessitating some intervention by prudent governments. Such interventions vary in degrees, depending on the nation. In Nigeria, individual could rarely lay claim to any part of it as owner and therefore could not alienate it without the consent of the head. Proper financing is all-important to successful property/real estate investment and development. Various forms of finance on varying terms from diverse investing agencies are available to the property/real estate market. The principal field where various forms of investment finance are employed is that of development where every loan has to be specially tailored for an individual scheme and the particular stages within the scheme. Since real estate and property development in particular involves huge capital expenditure, finance is therefore an essential input, the nature of which is to provide capital to enable the enterprise operate commercially (Ratcliff, 1999). The cost and availability of finance for real estate development can influence the viability of such project. It is necessary to examine the nature of real estate investment in Nigeria with a view of finding solutions to the associated challenges.

1.2   STATEMENT OF THE PROBLEM In recent times, research on real estate investment has been on the front burner has it is the major source of housing for man. In the hierarchy of man’s needs, housing has been ranked second and as a result of this; housing provision has become a paramount cornerstone of the policies of various governments both at federal and state levels since independence in Nigeria. The consequences of the rapid rate of urbanization are most visible in the rapid deterioration of urban housing resulting in urban housing poverty especially as there is no proportionate increase in the number of housing stocks. . During the period of economic boom in the 1970s in Nigeria, there was surplus capital, the economic climate then was favorable for the development of real estate and the prospect of gain was over blown and so were the rate of development. Due to the recent drop in the prices of crude oil world wide and corruption, government has not been able to invest in real estate. Overpopulation and urbanization has led to massive increase in property development. Financial houses readily obliged developers’ loans, as they perceived minimum risks. Since real estate development requires huge capital outlay, there is always the need for real estate developer to source for fund. However, this study will examine the scope of real estate in Nigeria and its associated challenges with a view of making useful suggestions on the way forward for real estate in Nigeria.

1.3   OBJECTIVES OF THE STUDY The following are the objectives of this study:

To provide an overview of real estate investment in Nigeria. To examine the challenges associated with real estate investment in Nigeria. To identify the way forward for real estate in Nigeria.

1.4   RESEARCH QUESTIONS

What is the level of real estate investment in Nigeria? What are the challenges associated with real estate investment in Nigeria? What is the way forward for real estate in Nigeria?

1.5   HYPOTHESIS HO: Real estate investment has no challenges in Nigeria. HA: Real estate investment has several challenges in Nigeria.

1.6   SIGNIFICANCE OF THE STUDY The following are the significance of this study:

The findings from this study will educate the general public on the benefit of real estate investment and its associated challenges which will form the basis for guidance in decision making. This research will also serve as a resource base to other scholars and researchers interested in carrying out further research in this field subsequently, if applied will go to an extent to provide new explanation to the topic.

1.7   SCOPE/LIMITATIONS OF THE STUDY This study on real estate investment and its associated challenges in Nigeria will cover the extent of real estate investment in Nigeria looking at the factors that has facilitated or hindered it. It will also cover the challenges associated with real estate investment in Nigeria.LIMITATION OF STUDYFinancial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.1.8   DEFINITION OF TERMS Investment: an investment is a monetary asset purchased with the idea that the asset will provide income in the future or appreciate and be sold at a higher price. Real estate: property consisting of land or buildings.REFERENCES Adewale, J.R. 2000: Real Estate Investment Analysis. Lexington Books. Lewis, M.G. (1994): When Real Estate Becomes Big Business: Mergers, Acquisitions and Joint Ventures. Cahners Publishing. Ratcliff, R.U. (1999): Real Estate Analysis. McGraw Hill, New York.

PROFESSIONALISING REAL ESTATE AGENCY PRACTICE IN NIGERIA

PROFESSIONALISING REAL ESTATE AGENCY PRACTICE IN NIGERIA: ISSUES AND THE WAY FORWARD

BACKGROUND TO THE STUDY  

Professionalizing is derived from the term Profession/Professional. A professional connotes a person with a distinct competence for a specified function or discipline (Ojewunmi, 2005). Such a person would have been trained or has acquired the necessary training in that discipline to become a professional in that field. A professional exists within the context of a profession; a distinct discipline or career path with its own training, qualification and membership requirements and standards. It is in the bid to establish such standards that professional bodies exist to ensure that persons within its fold have the requisite training/qualification and also abide by its rules and ethical standards (Kuye, 1998). A professional in any field is a highly regarded person and is deemed to have a certain level of competence expected of a person in that profession.

Real estate agency is essentially a land based profession that deals with the business of buying, selling or leasing of interests in real estate, which may be land or buildings or interests therein. Practitioners of this trade are generally addressed as Estate Agents in our environment. Considering the importance of housing in mans hierarchy of needs and the huge deficit that exists in the housing sector in Nigeria, Real estate Agents generally play a very important role in the socio-economic life of the country. Generally a real estate agent is a person, who possesses the authority to act on behalf of another person with a view to establishing contractual relationship between his principal and a third party. The person, who employs the agent, is usually called the Principal. Several variants of real estate Agent/Agency exist (Olatunji, 2008).

The practice of Real estate Agency in Nigeria at present remains largely unorganized, unregulated and unprofessional. Apart from the Nigerian Institution of Estate Surveyors and Valuers that has set standards for its practice by its members i.e. Estate Surveyors and Valuers, the large majority of those who practice estate agency do so without the basic training in that field, without any certification or qualification, without any regulation and largely in an unprofessional manner (Gambo & Ashen, 2012).

The practice is generally open to all comers and entry and exit are at the sole discretion of the person. Due to the lack of a central professional/regulatory body that will set minimum standards for entry, set standards for its practice, as well as ensure adherence to a code of ethics, most estate agents are generally on their own and quackery with its attendant consequences is very prevalent if not the order of the day (Gambo & Ashen, 2012). A multiplicity of local estate agents Associations exists but these are essentially local bodies without the right structure, leadership or plan to advance the practice of real estate agency beyond the parochial interest of the founders or originators (Hemuka, 2002).

The effects of this present state of real estate agency practice in Nigeria are indeed too numerous to count. The major effects are that due to lack of regulation and requisite competence on the part of the practitioners, the consuming public has been on the receiving end of estate agents in terms of very poor services, fraudulent transactions and losses of income through the activities of dubious practitioners (Hunter, 1997). As a result of this, the public perception of the real estate agent is very poor. Real estate Agents are generally looked upon as persons, who engage in sharp practices and whom you have to deal with, with “all eyes” open. In view of this, the practitioners are not respected in the society. The very low level of respect for the practitioners has led to a situation where both vendors and landlords alike do not see the need to remunerate them appropriately, while the lack of standardization and regulation has led to both the landlords and the vendors turning themselves into agents. In most cases, multiple agents are appointed and owing to lack of standardized practice procedures it usually turns into a cut throat competition amongst them. The level of abortive work done by the average real estate agent is phenomenally high due to the non standardized practice procedure. The police, EFCC and other law enforcement agencies are after the real estate agents in the belief that a lot of money laundering is done through the acquisition of properties with illicitly acquired wealth (Olatunji, 2008).

To achieve professionalism in the practice of real estate agency in Nigeria, the right approach will be to work towards ensuring that Real estate agents are appropriately trained and certified to practice, establish standardized prequalification and registration protocols for the prospective estate agents, keep a register of all qualified and certified estate agents, enforce compliance to a code of ethics and practice through sanctions, institute and implement mandatory training programmes for practitioners, Institute appropriate professional indemnity insurance programmes for members, to ensure the protection of members of the public, set remuneration due to agents whether as single agents or cooperating agents, generally regulate the practice of estate agency, develop and project the practice of estate agency as a respectable brand that will continuously earn the trust of members of the public through quality service delivery of its members. It will also protect and defend the interest of practitioners.

1.2   STATEMENT OF THE PROBLEM Real estate agency practice in Nigeria like other countries of the world contributes massively to housing delivery system as it helps to meet as well as cater for the housing/accommodation needs of people. Due to the important roles real estate agents play in the housing and accommodation delivery sector of the economy, so many people have become victims of accommodation fraud from the hands of some of these estate agents who go about duping genuine accommodation seekers which has been the reason for calls from many quarters on the need to professionalize the profession in Nigeria. Professionalizing real estate agency in Nigeria will benefit not just the consuming public but also the practitioners. While the public will benefit through improved or quality agency services from reliable and well referenced real estate agents, the practitioners will benefit through proper regulation of the practice, which will ensure that only qualified and certified persons practice the trade and that the practitioners are appropriately trained, equipped and remunerated.1.3   OBJECTIVES OF THE STUDY The following are the objectives of this study:

To examine the issues involved in the professionalizing of real estate agency practice in Nigeria. To determine the way forward for the professionalizing of real estate agency practice in Nigeria. To analyze the factors hindering the professionalization of real estate agency practice in Nigeria.

1.4   RESEARCH QUESTIONS

What are the issues involved in the professionalizing of real estate agency practice in Nigeria? What is the way forward for the professionalizing of real estate agency practice in Nigeria? What are the factors hindering the professionalization of real estate agency practice in Nigeria?

1.6   SIGNIFICANCE OF THE STUDY The following are the significance of this study:

The outcome of this study will be of benefit to the government and its agencies in that the practitioners of the trade will be brought under one umbrella, which will make easier the regulatory work of such government agencies like the EFCC in its fight against money laundering. The result will educate the general public on the need to patronize the professional real estate agents and what criteria makes someone a real estate agent e.g. qualifications and the professional body the real estate agent belongs to. This research will also serve as a resource base to other scholars and researchers interested in carrying out further research in this field subsequently, if applied will go to an extent to provide new explanation to the topic.

1.7   SCOPE/LIMITATIONS OF THE STUDY This study on professionalizing real estate agency in Nigeria; issues and way forward will cover the activities of real estate agency practitioners in Nigeria considering professional ethics and code of conduct.LIMITATION OF STUDYFinancial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.1.8   DEFINITION OF TERMS Profession: a paid occupation, especially one that involves prolonged training and a formal qualification. Ethics: moral principles that govern a person's behaviour or the conducting of an activity.

REFERENCES David P. Hunter (1997). Professional Ethics and the Real Estate Agent. Illinois Real Estate Letter Fall Fong-Yao Cheng (2008) Client Influence on Valuation: Does It Matter? A Comparative Analysis between Taiwan and Singapore. The 14th Annual Conference of the Pacific Rim Real Estate Society, Kuala Lumper, Malaysia. Gambo, M. J. and Ashen, M. J. (2012). Application of Economic Indicators in Predicting Construction Cost Escalation for Residential Buildings in Nigeria. International Journal of Economic Development Research and Investment, 3 (1), 27-32. Hemuka N. (2002). Ethical Behaviour and the Practice of Real Estate Surveying and Valuation in Nigeria. Kuye Olusegun (1998). Ethical Behavior and the Practice of Estate Surveying and Valuation in Nigeria. John Wood Ekpenyong Annual Lecture Series. Makanjuola Ojewumi (2005). How to Make Huge Profits in Estate Agency: 21 Lessons that Sharpen and Shape You. Knight Service Books, the Pent House Suit, Greenfield Plaza, Ibadan, Nigeria Oluwole Alfred Olatunji (2008). Assessing Client's Confidence and Satisfaction in Construction Professionals in Nigeria. Journal of Environmental Science, FUTA.

LAND REFORMS IN NIGERIA

LAND REFORMS IN NIGERIA: ISSUES, PROBLEMS, AND SOLUTIONS

BACKGROUND TO THE STUDY  

Land Reform generally involves the changing of laws, regulations or customs regarding land ownership. It may consist of government initiated or government backed approach to property redistribution of land as in the case of Nigeria, an outright transfer of ownership of land from the citizens to the state. The common characteristic of land reforms is usually the modification or the replacement of existing institutional arrangements governing possession, use and title. Thus, while land reform may be radical in nature such as large scale confiscation and transfers of land from one group to another or from one group to the state, it can also be less drastic and conciliatory in nature such as less painful transfers of land to the state and regulatory reforms aimed at improving land administration (Dale, 2007).

Land is perhaps the single most important natural resource in the sense that it affects every aspect of a people’s live; their food, clothing, and shelter. It is the base for producing raw material for the manufacturing industry. It is an important resource. No nation-city or rural area can survive as an entity without it. Thus, every person in a nation – the banker, the industrialist, the labourer, the educator, the student, the planner, the farmer- has a vital stake in the country’s land problems and its proper utilization (Acquaye, 1976).

The Land Reform committee in Nigeria is aimed towards enabling the states to be effective managers of land. It is aimed to provide a systematic cadastral survey of land in the entire federation (a political entity called Nigeria). The Term of Reference makes it an essential body to assist both states and local government to carry out the cadastre survey and codify the possessory rights of vast majority of the people access to land and landowners. The Term of Reference necessitate the body to collaborate and provide technical assistance to state and local government in undertaking cadastral survey and to ensure the demarcation of land boundaries and title holdings are demarcated in such a way that communities, hamlets, villages, towns etc are recognized. It was also saddled with the responsibility of encouraging and assisting states and local government to establish adjudication mechanism for land ownership conflict resolution and to make recommendation for mechanism for valuation in both rural and urban areas.

Security of tenure and land rights of citizens is an important foundation for economic development. For many of these, land titles are the main sources of collateralization for obtaining credit from informal and established financial institutions. Consequently, securing land rights and land titles is particularly relevant for all socio‐economic classes in the nation’s economy but especially to the farmers whose pervasive poverty to date derives from not having definitive property rights appropriate to a market economy. Furthermore, fees and taxes on such landed properties are very important sources of revenue for governments particularly at the State and Local Government levels. A national programme that thus sets out to enhance and secure the property rights of all groups in the society can only end up creating a economic empowerment. Funding Land Reform programme should therefore be a national effort to be borne by all three tiers of government in proportion to their capabilities (Mabogunje, 2007).

For a country striving to be one of the twenty largest economies in the world by the year 2020, the situation with respect to land rights and transactions in land still leaves very much to be desired. The World Band publication on “Doing Business in Nigeria 2010” rated Nigeria 178th out of 183 economies in respect of difficulties of registering properties in the country. Mabogunje (2007) attributed this to the following reason “a large share of land in the country is not formally registered [whilst] informal titles cannot be used as security in obtaining loans which limits financing opportunities for businesses” especially small and medium‐size enterprises. If Nigeria is to meet the challenges of competing effectively in an increasingly globalizing world, it is thus imperative that it gives very urgent and sustained attention to promoting its land reform program in all of its ramifications to facilitate property development.

1.2   STATEMENT OF THE PROBLEM Land Titling and Registration is essential for economic development of a Nation. The Nigerian nation had had a multiplicity of land tenure system until the 1978 Land Use Act which harmonized all the systems. The land use pattern in Nigeria estimated arable land to be about 33% of the total land area, permanent pastures cover 44%, permanent crops cover 3%, forest and woodlands 12%, and others 8%. Thus land is still the main asset of the rural Nigerians where over 80% are peasant farmers; however this asset has not been fully utilized for economic empowerment because they do not have proper records and titles that can be used as collateral to raise capital. It is in an attempt to economically empower the vast majority of Nigerians, who are rural dwellers, by turning their land holdings to economic capital, that the current Federal Government of Nigeria initiated the Land Reform Agenda. However, the researcher is providing an overview of land reforms in Nigeria considering the issues and prospects. 1.3   OBJECTIVES OF THE STUDY The following are the objectives of this study:

To provide an overview on the issues of land reforms in Nigeria. To examine the problems of land reforms in Nigeria. To analyze the solution to the problems of land reform in Nigeria.

1.4   RESEARCH QUESTIONS

What are the issues of land reforms in Nigeria? What are the problems of land reforms in Nigeria? What are the solutions to the problems of land reform in Nigeria?

1.6   SIGNIFICANCE OF THE STUDY The following are the significance of this study:

Outcome of this study will educate the general public and students on the issues, problems and solutions of land reforms in Nigeria with a view of identifying the inadequacies. This research will also serve as a resource base to other scholars and researchers interested in carrying out further research in this field subsequently, if applied, it will go to an extent to provide new explanation to the topic.

1.7   SCOPE/LIMITATIONS OF THE STUDY This study on land reforms in Nigeria will cover all the issues and problems of land reform in Nigeria. It will cover the activities of the regulatory framework and the accessibility of land to Nigerians for use.LIMITATION OF STUDYFinancial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.1.8   DEFINITION OF TERMS Reforms: make changes in (something, especially an institution or practice) in order to improve it. Land: the part of the earth's surface that is not covered by water.REFERENCES Mabogunje, A.L. (2007). Development as Societal Transformation and Empowerment. Lecture Delivered at the Retreat of the People’s Democratic Party, Abuja, January 8. Dale, Peter. 2007. “Good Land Administration – It’s Role in the Economic Development” Keynote Speech on Land Administration in Transition International Workshop, Ulaanbaatar, Mongolia. June 27 -29. Solomon, A.O. (1991): Title to land in Nigeria; An inaugural Lecture delivered at Obafemi Awolowo University, Ile-Ife, On June 1991. Osei-Bonsu. S.N. (1983): Alternative Approaches and strategies to Rural Development Studies Vol. 3 Nos. 1 page 31-32. 

INFRASTRUCTURE RENEWAL PROGRAMS: A REMEDY TO LAGOS MEGACITY CHALLENGES

BACKGROUND TO THE STUDY  

The population of Lagos is at present in excess of 18 million. A megacity status is conferred by the United Nations on cities with a population of 10 million and above. Building and preserving a model mega city comes with great challenges. Providing a sufficient amount of infrastructure and other necessities that would accommodate the needs of over 18 million people could be daunting (Ayeni, 2008).

By 2025, officials and population analysts agreed that the number of people in the city and in the surrounding communities, especially, in Ogun State axis, would leap to 30 million. Prominent among the challenges are housing, infrastructure and transportation, particularly in more than 10 local government areas (LGAs) that made up of the state, excluding local council development areas (LCDAs). Besides, the notorious traffic jams, choking pollution, inadequate supply of potable water, insecurity and absence or inadequate social and economic needs of the people pose more challenges. Apart from series of efforts put in place by government through several urban renewal programs, the uncontrolled influx of people from virtually every states of Nigeria, including neighboring countries, such as Benin Republic, Togo, Ghana and others, is heightening the fear that the next few years would provoke a daunting task for the authority (Tim, 2003). It has been observed that in some houses in Lagos metropolis, septics are channeled directly into the drain. The government is, therefore, challenged to invest heavily in the protection of the environment through urban renewal programs in order to avert environmental abuse and its consequences. People migrate from villages to the city-centre, without adequate understanding of reality on ground. Here, culture comes into play, such as open defecation as being done in the village, spreading of clothes publicly and cooking exercise in any open place, among others which is frustrating the efforts of the state government at transforming the city through urban renewal programs. Official admitted that planned urban renewal is a major challenge in an emerging model city like Lagos (Batley, 2003). Prior to the current urban regeneration efforts by the government, Lagos used to be referred to as a jungle of various emerging slums. However, a systematic urban development and slum renewal programme, in partnership with several development agencies, has since been put in place to reverse the trend being a major remedy to combat the menace characterized by urbanization. Consequently, various model city plans that included Ikeja Model Plan, Victoria Island/Ikoyi Model City Plan, Lekki Comprehensive Land Use and Infrastructure Master Plan have been completed while Mainland Central Model City Plan Badagry Draft Master Plan and Alimosho Master Plan have been concluded, while others are at various stages of execution. However, in order to give the urban renewal programme a legal backing, the Lagos State Model City Development Law was enacted in 2009 while the State Urban and Regional Planning Law were signed on July 7, 2010.

According to Lindan (1993), certainly, a megacity requires a stronger financial base. The sheer size of funding required in sustaining a megacity is beyond what a government could provide on its own. To this end, Kadiri was of the view that both federal and Ogun state governments should support Lagos in her efforts to sustain the challenges involved as a result of its mega status through the urban renewal programmes. According to Ogunleye, for the fact that many of the old slum areas are not in hidden locations make it easier for government to incorporate them in its urban renewal programmes. The formation of new slums is prevented but people’s influx is however not controllable in Lagos State, knowing full well that no legislation that frown against migration to the city. But government will do well if it opens up new settlement with the necessary infrastructure put in place. Although, government has embarked on infrastructure renewal projects that include the execution of on-going projects such as the light rail scheme from Orile to Mile 2, the redevelopment of the Lagos-Badagry expressway into ten lanes incorporating BRT lanes and light rails, on-going reconstruction of the Mile 12-Ikorodu road incorporating BRT lanes, the recently commissioned Ejigbo- Ajao Estate link bridge, recovery and redevelopment of loops hitherto used by criminals as hide-outs among others could only become feasible with a sustained system of funding. Notwithstanding the profoundness of these projects, it appears that much still need to be done to meet the need of millions of commuters on daily basis.

The condition of the environment also constitutes a major challenge to the Lagos megacity city. Lagos, for instance, generates 10,000 tonnes of waste daily, almost three times higher than what the whole of Ghana generates daily. Also, the kind of industrial pollution experienced in Lagos is second to none in the country. Maintenance of law and order is another major challenge of the Lagos mega city. Though a mega city status is conferred on a city as a result of population growth, building and sustaining a model mega city is not a tea party as reflected in the Lagos experience. In the case of Lagos, a major challenge, however, is how to cope with the ever-increasing population of Lagos with its attendant consequences on infrastructure

1.2   STATEMENT OF THE PROBLEM This study considers the solution to the challenges of Lagos mega-cities characterized by urbanization as an effective urban renewal programme. This approach is aimed at providing housing, environmental policies and planning strategies appropriate for facing the challenges of the urban growth and development. A megacity is usually defined according to the United Nation as a metropolitan area with a total population in excess of 10 million people. Some definitions also set a minimum level for population density (at least 2,000 persons/square km). A megacity can be a single metropolitan area or more metropolitan, depending on the definitions and boundaries being used. However, the researcher will provide an overview about urban renewal programme as a remedy to Lagos Mega city challenges.1.3   OBJECTIVES OF THE STUDY The following are the objectives of this study:

To examine the challenges of the Lagos mega city. To identify the urban renewal programmes put in place by government of Lagos State in addressing Mega city challenges. To determine the effectiveness of urban renewal programmes in Lagos State.

1.4   RESEARCH QUESTIONS

What are the challenges of the Lagos mega city? What are the urban renewal programmes put in place by government of Lagos State in addressing Mega city challenges? What is the effectiveness of urban renewal programmes in Lagos State?

1.6   SIGNIFICANCE OF THE STUDY The following are the objectives of this study:

The outcome of this study will educate the general public on how an effective urban renewal programmes can curb mega city challenges. This will also sensitize the policy makers on the need to introduce an urban renewal programme in controlling issue related to megacity problems in their territory. This research will also serve as a resource base to other scholars and researchers interested in carrying out further research in this field subsequently, if applied will go to an extent to provide new explanation to the topic.

1.7   SCOPE/LIMITATIONS OF THE STUDY This study on infrastructure renewal programmes as a remedy to Lagos mega city challenges will cover all the programmes set up by the Lagos State government at tackling infrastructural challenges created as a result of the mega city. This study will also cover the issues leading to infrastructural decay in the State.LIMITATION OF STUDYFinancial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.REFERENCES Ayeni, B. (2008), “Lagos: Problems and Planning in Third World Cities”, St. Martin's Press, New York. Batley, R. (2003), “Political Control of Urban Planning and Management”, Managing Fast Growing Cities: New Approaches to Urban Planning and Management. Longman, London, pp. 176-206. Halla, F. (1994), “A Coordinating and Participatory Approach to Managing Cities”, Habitat International, Vol.18 No 3, pp. 19-31. Linden, E. (1993), “Mega-cities”, Time Magazine, 11 January, pp. 141-2, Tim, M. (2003), “Cairo Megacity“, Travel Guides Hotel Reviews; virtualtourist.com  

IMPACT OF REAL ESTATE SECTOR TO THE ECONOMIC GROWTH OF NIGERIA

 BACKGROUND TO THE STUDY  

The Real Estate sector offers a great potential source of growth for Nigeria. Until now, the understanding of its composition and growth has been somewhat limited to its required use in Nigerian national accounts. Development is a general word that encompasses all aspects of human life, segments and disciplines, which give direction to the state of an economy. Globally, real estate sector is one of the most profitable ventures of every economy and one of the indices of measuring economic growth of a society. It is a sector that mirrors the economic viability and sustainability of an economy and its poverty level. Though there was no accurate data about housing shortage in Nigeria, it was however estimated that the shortage has risen to over 17 million (Ebie, 2005). Successive governments over the years have attempted to resolve these shortages with various policies but rather than reducing, the shortages kept increasing year in year out.

According to Ajanlekoko, 2001, the Federal housing agencies located in each state of the federation, were statutorily created to execute public housing programmes for each state of the federation based on the formulated housing policies. Specifically they are to undertake the development of estates by acquiring, developing, holding, managing, selling, leasing or letting any property movable or unmovable in their respective states; provide a home ownership saving scheme in respect of any housing estate or building owned, constructed and managed by them with a view to enabling members of the public purchase or build their own houses; provide sites and services scheme for residential, commercial and industrial purposes for the people of their respective states; construct and maintain modern dwelling houses at reasonable costs for sales to members of the public, undertake the construction of offices, commercial and industrial buildings for letting out to members of the public among other things, engage in other investment activities and opportunities as may be determined by the respective state governments. If there has been effective implementation of housing policies, all these would have significantly benefitted the masses and above all contributed to the growth of the nation’s economy as a result of profit made from sales and rents. Unfortunately however, most of the state housing agencies are under-utilized and have been rendered redundant and could hardly carry out their primary responsibility as elaborated in the respective laws setting up these agencies (Zubairu, 2001). Basically, the problems of housing delivery in Nigeria are rooted in three major factors namely lack of finance, escalating cost of building materials and infrastructural development cost.

These three problems are however peculiar to all housing delivery agencies and somewhat make affordable and mass housing difficult and has however reduced the contribution of the real estate sector to the nation’s economy.

1.2   STATEMENT OF THE PROBLEM Today in Nigeria, most of the housing corporations and the housing estates built by the previous governments merely exist by names (Mailafia, 2005). In some states, housing corporation staffs who are specialists in real estate development and management are rendered irrelevant in their special field while state ministries have taken over construction and in some states they have been merged with the ministries. This situation has relegated housing development to the background and hardly can we see any government owned housing unlike in the second republic. These has drastically affected the amount of income generated though the real estate sector. However, private partnership participation has enable more person to benefit from the business to improve their personal standard of living. However, the researcher is examining the impact of the real estate sector on the economy growth of Nigeria.1.3   OBJECTIVES OF THE STUDY The following are the objectives of this study:

To examine the impact of the real estate sector on the growth of Nigeria’s economy. To identify the factors limiting development of the real estate sector in Nigeria. To determine how the real estate sector can contribute massively to the economic development of Nigeria.

1.4   RESEARCH QUESTIONS

What is the impact of the real estate sector on the growth of Nigeria’s economy? What are the factors limiting development of the real estate sector in Nigeria? How can real estate sector contribute massively to the economic development of Nigeria?

1.5   HYPOTHESIS HO: Real estate sector has not contributed to the economic growth of Nigeria. HA: Real estate sector has contributed to the economic growth of Nigeria.1.6   SIGNIFICANCE OF THE STUDY The following are the significance of this study:

Findings from this study will be a useful guide for the policy makers and the government of the day on how real estate sector can contribute to the nations development and how the housing policies can be implemented effectively to boost economic growth. This research will also serve as a resource base to other scholars and researchers interested in carrying out further research in this field subsequently, if applied will go to an extent to provide new explanation to the topic.

1.7   SCOPE/LIMITATIONS OF THE STUDY The scope of this study on the impact of the real estate sector on the growth of Nigeria’s economy will cover the structure and activities of real estate in Nigeria and its contribution to the nation’s economy.LIMITATION OF STUDY

Financial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview). Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.