What should we expect in the real estate sector this year? How optimistic are investors about new opportunities? In a bid to provide indepth understanding of what the real estate market for 2015 may hold, Lamudi Nigeria interviewed some of the top real estate agents in Nigeria.
Here are their predictions for the sector in 2015:
Tope Ayodele, MD, Covenant Real Estate:
In the first quarter, the the purchasing power of people will be low because of the naira devaluation. The market is presently unpredictable but in the [long run] the market will boom. [During] the second quarter, there will be a considerable rise- but unpredictable because of oil price and elections.
Emeka Agu, MD, Emeka Agu & Co:
We are hoping we have a stable country, with a stable state business will boom and things will kick off!
Lawal Olaide Tresvant, Business Development, Efficacy Homes Limited:
2015 is going to be a wonderful year! Because of the elections period there might not be much cash, but we have a wonderful package for our clients: very affordable housing and new investments as low as 10 million naira.
Bala Ishaku, Beverly & Sam:
The first quarter is going to be slow for residential but there shall be more interest in the commercial as new businesses are coming up. Elections is a factor but the flip side is there is a lot of trading in property; people selling in the high hand and developers looking to buy. It will kick up after the elections even though the purchase power will be low.
Kola Ashiru-Balogun, MD, ARM Properties:
The first Quarter is going to be dull because of elections. We foresee only 6 months of activities. It’s going to be a tough year but the demand is still there! People will reduce the price of their property to create a semblance of sales. The office demand will remain strong. Business is not as sensitive as people (households). But there would not be quality Class A space this will only be in 2016.
Emmanuel Akpa, MD,Emma Akpa & Co:
[It will be] good because some upscale properties are coming, such as: Rainbow town in Port Harcourt, Atlantic City or Lakowe in Lagos and Centinary City in Abuja as well as some new residential building on Gerard road, Ikoyi.
Bosu Okusaga, Managing Partner, Babajide Okusaga:
We will witness stability in property transactions especially in the price until the middle of the year. In the fourth quarter things will start to kick off. Real estate will the best place to invest as interest rates will not be attractive thus people won’t go to banks also the price will be more realistic.
Anthony Iraoya, Managing Partner, Pius Omeife and Co:
The market is bright especially in Abuja. Politicians are selling properties to get fund but after Election they will start reinvesting. The market will be boom as the oil and gas crisis [is] temporary. With 2 million housing deficit in Nigeria the demand is very high but the only issue is the price. If you build affordable homes before you market it they are off the market!
Ayodele Thomas, MD, KingsCourtRealtors:
Due to uncertainty in the global economy as a result in fall in oil prices and slow demand from America and China, I foresee a bit of slowdown in real estate development in Nigeria, especially in luxury real estates, as a result of scarcity of funds. Investors’ sentiments are likely to change in terms of real estate investment.
However, I see a boost in the rental market, and especially in the middle range housing. Other areas to watch out for are retail and recreational developments. Real estate opportunities will be driven in 2015 by new opportunities in middle income areas, especially around the Lekki-Epe Axis. Is 2015 a good year to invest? Yes, better to get in when prices are bottoming up than when rising. With the low demand in real estate in 2015 and scarcity of funds, prices will have to come down in 2015.
We will however see an upward shift from the 3rd to 4th quarter of this year. 2016 will be a golden year for Real Estate.
Mr Gbenga Odusiga (Partner), Gbenga Odusiga & Co:
Activities in real estate market for residential properties in Abuja will improve by the middle of 2015. Rents will not necessarily increase because supply and demand will be at equilibrium owing to the near completion of various on-going estates developments especially the mass housing & request for purchase of estate plots.
Fola Obabiyi, (Managing Partner), Bosiva Realtors, Real Estate and Property Consultancy:
The property market in 2015 as regards Abuja, the F.C.T. Promises to be an exciting one, though it is starting rather on a slow note due to a lot of economic factors such as the devaluation of the Naira and non payment of civil servants salary knowing fully well that the major workforce in the F.C.T are the Civil servants. But it would definitely pick up in the coming months because it is an election year, new politicians would be sworn in into various offices and they are coming with a retinue of aides and of course their families. This means houses that are in the market both for lease and for sale would be occupied by these people. But if the after election violence can be avoided, then the property business promises to be exciting this year.
Mr Fergus Esezobor (Partner) Sheffieldoaks Real Estate Solutions:
Property market will slow during the first quarter because most investors want to know the outcome of the elections before putting their money into any investment plan.
It is election year, most buyers and sellers’ perception of the market is negative. But, I expect properties to remain fairly consistent throughout the year. I do not see a big dip in values or a rapid increase in the market values. What I predict is a very small gain more than likely to occur throughout the year.
Engr. Ayodele Ogunlana, Baocam and Truss LTD:
As we go into the year 2015, prices of properties both for sell and lease are likely to remain stable throughout the year; we might witness a little dip in the prices of luxurious properties across the nation; ardently more in the Federal Capital Territory. With the dwindling oil prices and the recent devaluation of the Naira amidst the prevailing economic situation, fewer cash would be available for Government in the state and federal levels to investment in the real estate sector.
However, I perceive that more Public Private Partnerships (PPP) would be entered into this year compared to the presiding year, as the stake holders would be more confident to deal, knowing that the Public Official would have at least four years in the case of Governors and President to be in office.
In general, most of the real estate transactions to be done this year would be post February 14th Presidential elections, with a sharp rise after a successful May 29th Democracy day.