Federal Housing Estate, Onitsha, Wears New Look As Roads Are Rehabilitated, Street Light Installed

The only Federal housing estate in Anambra State Federal Housing Estate, 33 Onitsha, Onitsha North LGA, now wears a new look as the estate which used to look like a jungle as a result of lack basic amenities like good road network, electricity, efficient waste disposal system etc is now witnessing a turnaround as many roads have been rehabilitated, well knit security arrangement put in place as well as efficient waste disposal and constant electricity.

Newsmen who monitored lifein the estate recently gathered from residents that the estate which used to be plagued by lack of amenities has suddenly bounced back to reckoning as a result of efforts of the new leadership of the estate who they said took office not long ago.

Investigation by newsmen showed that many unpassable streets abandoned long time ago as a result of damage hae been rehabilitated and opened for easy vehicular movements, some of these streets which used to pose a great danger like, St Stephen, St Augustine, Ogbatuluenyi, among others have been given a facelift and tarred as well as adorned with street lights.
Newsmen further findings indicated that the perennial problem of power which used to be a major challenge in the estate has been retified for constant electricity to flourish as many transformers can be seen adorning strategic areas of the estate. Additionally it was observed that the waste disposal and the estate cleanliness has been boosted as men of the Anambra State Waste Management Agency (ASWAMA) were seen carting away refuse and ensuring cleanliness in the area just as eagle eyed vigilance operatives where also sighted all over the estate providing security to complement the efforts of the police.

Commenting on this, two residents Mrs. Nneka Okeke, a retired teacher and a house wife, and Mr. Igwebuike Dike, an entrepreneur, attributed the development to the commitment of the new leadership of the estate whom she said was showing transparency and purposefulness in the leadership of the estate, noting that everybody in the estate was happy with their synergy with the Anambra State government who is listening and attending to their problems.

READ: ABUJA INTERNATIONAL HOUSING SHOW – THE LARGEST HOUSING AND CONSTRUCTION EXPO IN WEST AFRICA

Contacted also, Chief Ben Arinze Anyaora, the chairman of the estate, declined comments but referred newsmen to residents whom he said were in a better position to assess development in the area.

By Eche Nwaobasi-Nnewi

Tracking the National Housing Fund

IN its determination to make ‘housing for all’ a reality, the Federal Government established the Federal Mortgage Bank of Nigeria (FMBN) in 1956. It was formerly known as the Nigerian Building Society (NBS). The Federal Government, by the Indigenisation Act [1973], acquired the NBS and consequently renamed it the Federal Mortgage Bank of Nigeria (FMBN). In 1994, FMBN assumed the status of the apex mortgage institution in Nigeria, with the promulgation of the FMBN Act 82 [1993] and the Mortgage Institutions Act 53 [1989]. It also commenced the management and administration of the contributory savings scheme known as the National Housing Fund (NHF) established by Act 3 of [1992].
The fund was established to facilitate the mobilisation of funds for the provision of houses for Nigerians at affordable prices, and guarantee constant supply of loans to Nigerians for the purpose of building, purchasing and development of residential houses. It is also aimed at providing incentives for the capital market to invest in property development; encouraging the development of specific programmes that would ensure effective financing of housing development, in particular, low cost housing for low income workers. In addition, it is meant to provide proper policy control over the allocation of resources and funds between the housing sector and other sectors of the Nigerian economy, as well as provision of long-term loans to mortgage institutions for on-lending to contributors to the fund.

The Informal Sector Cooperative Housing Loan Scheme also known as “The Coop Loan Scheme” is a product of the NHF Scheme, designed to accommodate non-salaried informal sector Nigerians through co-operative societies to join the National Housing Fund and avail themselves the opportunity of becoming proud home owners. The loan cacility under the Scheme could be accessed one of two ways, namely the Cooperative Housing Development Loan (CHDL), enables a cooperative society that has acquired a plot of land to develop houses for allocation to its members. The parcel of land will have title in the name of the society which will act as the facilitator on behalf of its members in the loan transaction and which would facilitate construction of the housing unit. The root of title of the estate land would be subleased to the beneficiaries.

READ: ABUJA INTERNATIONAL HOUSING SHOW – THE LARGEST HOUSING AND CONSTRUCTION EXPO IN WEST AFRICA

Also, the Cooperative National Housing Fund Loan (CNL) offers individual cooperative member’s mortgage loan to buy a housing unit develops through the Cooperative housing Development Loan or renovates an existing one. NHF registration is open to all Nigerians whether self-employed or in paid employment, as they are required by the NHF Act No.3 of 1992 to contribute 2.5 per cent of their basic salary/income to the fund. Nigerians need to take advantage of the NHF and become home owners with ease.

SOURCE: Oke Peter, Ibadan

502 stranded TCN containers so far recovered ―Fashola

ABOUT 502 stranded containers belonging to the Transmission Commission of Nigeria (TCN) have been claimed, the Minister, Power, Works and Housing, Babatunde Fashola on Tuesday said.

He said the containers, which had been left stranded at different ports across the country, are on transit to their various destinations.

Fashola spoke, at the presentation of the final report of the 20-year Transmission Master Plan at the TCN headquarters, Abuja.

According to him, this was made possible with the various efforts made by the current administration to increase the capacity of the company.

These, he said, include; budgetary committee on the part of the President, policy approvals, tax approval programmes, the N701 billion payment assurance guarantee, grid expansion programme.

READ: ABUJA INTERNATIONAL HOUSING SHOW – THE LARGEST HOUSING AND CONSTRUCTION EXPO IN WEST AFRICA

“When this current administration was inaugurated in 2015, the story of the TCN is lack of capacity to transport energy. The story was that it has only the capacity to do 5,000MWs.

Things have changed, the President has given a mandate to the Ministry and by extension to TCN to improve its capacity to deliver service between the GenCos and DisCos and this is backed by policy approvals, tax approval programmes, N701 billion payment assurance guarantee, grid expansion programme and supported by budgetary committee which has been helpful.
“As at yesterday, we have been able to recover 500 containers belonging to TCN containing pieces of equipment that were meant for transmission expansion projects that were left at our ports before President Buhari became president. The containers have travelled to the intended destinations, TCN sites where works have resumed.”

He reaffirmed that as at December 2017, the TCN simulated capacity was 7125MWs adding that more projects will be completed this year.

While receiving the final report of the 20 years transmission expansion plan, the Minister said this will help ensure that issues of stranded power do not resurface in the future.

To this end, he urged all players in the power sector not to only familiarise themselves with the plan, but to also take ownership.

“there is a session of this plan that belongs to all of you,” he added.

He further urged the consultant, Fitchner, to ensure that the report is simplified into a booklet to be given to key players.

Earlier, the interim Managing Director (MD), Engineer Gur Mohammed explained that the 29 years Transmission Master Plan was conceived since the delivery of the National Load Demand Study in 2009.

According to him: “After the conclusion of National Load Demand, it became necessary for the nation to have the Least Cost Transmission and Generation Master Plan in order to meet the demand as explained in the load demand report.

“TCN engaged Fitchner of Germany under the NEGIP, which is a project financed by the World Bank in November 2015.

“The study started with data collection aimed at establishing the basis for the assignment. The data collection was followed by clarification by TCN System Planning Team in 2016.”

While presenting the final report to the Minister, he assured that the TCN took time to review the report by Fitchner.

By Adetola Bademosi

Lagos Launches Electronic Platform To Provide Information On Properties With Pending Court Cases

The Lagos State Government on Tuesday launched the Lagos State Electronic Real Estate Litigation System, an online platform designed to provide easy access information to anyone who intends to deal in real estate with information primarily on whether the property is subject of litigation.

State Attorney General and Commissioner for Justice, Adeniji Kazeem , who launched the online platform in Alausa, Ikeja, Lagos, Southwest Nigeria said with the vision of becoming the largest economy in Africa, it was expected that the level of economic and commercial activities in Lagos State would experience an unprecedented level, height and pace, saying that the real estate sector was expected to further attract a significant amount of attention.

“The world we know today is at the click of a button technology driven and the Lagos State government is certainly in trend with the time. We have been working endlessly to ensure that Lagos is not left in the dark ages. This is why several initiatives and steps are being taken to make Lagos State as technologically driven as possible,” he said.

Kazeem further said the Lagos State Electronic Real Estate Litigation System would provide members of the public with information on pending court cases, notify members of the public of real estate/property which were the subject of pending litigation and ensure that members of the public/professional bodies were able to conduct an efficient search of real estate/property that is faster, reliable and convenient.

The commissioner, who was represented by the Solicitor General and Permanent Secretary, Ministry of Justice, Funlola Odunlami added that the platform would curtail risk associated with property transactions and reduce litigation on real estate as the public could now easily confirm if a property was subject of a pending litigation.

READ: ABUJA INTERNATIONAL HOUSING SHOW – THE LARGEST HOUSING AND CONSTRUCTION EXPO IN WEST AFRICA

Kazeem stated that the platform would enhance due diligence in property transactions, provide a comprehensive database of real estate/property in Lagos which is subject of litigation and allow the members of the public to file for LisPendens, that is, by submitting their case(s) which is subject of a pending Court case and that same would be regarded as sufficient notice.

“This project was conceived to ensure that citizens of Lagos State are better served. It is now being delivered as another promise kept for a better Lagos for all. This innovative project has been designed in line with this administration’s drive to promote information technology in the State.

“I therefore call on you all to buy into this new initiative, embrace it, and share in our vision of a new, enhanced System of real estate due diligence in Lagos State. This new initiative known as the Lagos State Electronic Real Estate Litigation Electronic System (Lis Pendens Electronic System) makes this readily available for properties in Lagos State,” he said.

Chief Judge of Lagos State, Justice Opeyemi Oke, who was represented Justice Laide Olayinka described the new platform as a worthy initiative, lamenting that there were many property cases subject to litigation in court which people did not know, adding that the platform would surely complement the justice system in the state.

Surveyor General of the State, Sango Wawa said the launch of the online platform was away of moving the real estate industry forward, stressing that the project would enhance the smart city status Lagos is craving, as everything would not be done online.

By Kazeem Ugbodaga

NSE Wants Indigenous Engineers To Drive Infrastructural Development

Mr Emeka Ugoanyawu, the Chairman of Nigerian Society of Engineers (NSE) Imo branch, says indigenous engineers should be given the opportunity to drive the infrastructural development in the country.

Ugoanyawu made the call while addressing engineers in Imo during the society’s New Year forum with the theme: Engineering Intervention for Sustainable Development”.

He called on both federal and state governments to use indigenous engineers’ professional to not only develop infrastructures but to ensure sustainability in the execution of projects.
He said infrastructural engineering projects in most states were being carried out by mediocre and non-professionals who did not possess engineering principles, supervision and monitoring skills.

Ugoanyawu urged government at all levels to see NSE as partners and major stakeholders in the development of the nation.
“The first second and third industrial revolution have come and gone and now the fourth revolution is on course and we have been left behind.

“The fourth industrial revolution is bringing together physical, biological and digital system to completely change mankind, while driver-less vehicles and artificial intelligence are already with us, yet we are still talking about things that will not move us forward,” he said.

He therefore urged engineers in the country to rise up to the occasion to save the nation from backwardness as a result of lack of development.

Read: ABUJA INTERNATIONAL HOUSING SHOW – THE LARGEST HOUSING AND CONSTRUCTION EXPO IN WEST AFRICA

Ugoanyawu said engineers must ensure leaders were responsibility of their actions and inaction by doing the right thing themselves to show good leadership.

Mr Ossai Obiako, a fellow of the Nigerian Institute of Structural Engineers blamed some of the failed projects in Imo on non-involvement of professionals in such projects.

He insisted that an integrity test be conducted on the two flyovers in Imo, adding that a preliminary investigation had faulted the flyovers.
“We have numerous failed projects in Imo and we as professional body is calling on the state government to work with us to find lasting solution to these problems,” he said.

He said the two flyovers had failed because they could no longer serve their purpose and the only solution was to take remedial action by subjecting them to integrity test for the safety of the masses.

Obiako however cautioned pedestrians against using the flyovers until they were certified fit by professionals.

A team of Council for Regulation of Engineering in Nigeria (COREN) led by its National President, Mr Kashim Ali had earlier faulted the integrity of the two bridges during their visit to Imo.

Egypt to pour new housing into seemingly sated market

CAIRO: Egypt’s government plans to pour tens of thousands of new housing units onto the market in each of the next few years, but it’s not clear how easily the country can absorb them.The authorities say they want to reduce crowding in Egypt’s congested cities and provide homes for the poor but many analysts say the new residences are priced way beyond the means of most Egyptians and a good share of them will remain unsold.

The government is undeterred, however, and is moving full steam ahead on a new capital city 50 km east of Cairo, a project that will designed to deliver 240,000 new housing units over the next five years.

It is also in the second year of a five-year plan to provide a million subsidized homes for the poor. According to press reports, 150,000 low-income units have already been delivered and another 260,000 are under construction.

Dozens of other housing projects, many spearheaded by the army, are underway. Activity is especially strong along the Suez Canal, which has been declared a special economic zone, at Gabal Galala in the mountains along the Gulf of Suez and at al-Alamein on the Mediterranean coast.

A network of highways and residential streets has been extended into the desert around Cairo to make way for the new developments, especially to the east towards Suez, in anticipation of a flow of buyers seeking to escape the crowded confines of the Nile Valley.
Some of the demand for new housing is coming from Egyptians working overseas who sent more than $5 billion back to Egypt in the third quarter of 2017 alone.

With inflation now running at an annual 22 percent and expected to remain in the double digits for several years at least, Egyptians have been searching for investments that will preserve the value of their assets.
Because of years of restrictions on sending cash abroad, the only place most Egyptians inside the country can invest their cash, apart from the country’s small stock exchange or in interest-bearing bank accounts, is in real estate.

As a result, Egyptians have been snapping up apartments and villas in new desert developments, confident that housing prices have nowhere to go but up in an overcrowded country whose population is growing by 2.5 percent a year.
“The more inflation is on the rise, the more people will run towards real estate, regardless of the real demand and real supply,” property consultant Haitham Khalifa said.

This rush to buy real estate has created a vast pool of housing, but it is unclear who will want to buy or rent them when their owners decide they want to cash in on their investments. Row upon row of houses now stand empty.
For many Egyptians, these properties are their main investments. Many of wealthy people have bought dozens of villas and apartments, with some rented out and others sitting empty.
According to a census released in October by the state statistics agency CAPMAS, 13 million units are either under construction or finished but unoccupied, compared to 22.5 million units that are inhabited.

Added together, this works out to 35.5 million units in a country with a population of 96.4 million, or 2.7 people per unit.
Signs are emerging that the new government housing projects will be entering a market that is already saturated, especially at the higher end. Measured in US dollars, housing prices in Egypt dropped substantially after the government devalued the currency by half in November 2016.

Wael Ziada, head of investment company Zilla Capital, estimates that prices have fallen to about $800 per square meter from $1,000 before the devaluation.

READ: 13 Reasons Why you Should Exhibit at the 12th Abuja International Housing & Construction Show 2018

“This is something companies will never tell you. They will not go below their headline prices,” said Ziada, who until recently was head of research at EFG Hermes, Egypt’s biggest investment bank. “What they may do is allow for a smaller down payment and a longer period so that the effective price will go down.”

Aly Allouba, the head of Cairo-based Edge Portfolio Management, gives an example. At the end of 2013, he had his eye on a townhouse in a compound built by one of the smaller property developers.

The seller at the time was asking two million Egyptian pounds, when the pound was at 6.95 to the dollar, or $288,000. The seller was demanding 15 percent down, with the rest paid in quarterly instalments over four years.
Now, four years later, the seller is asking 4 million Egyptian pounds ($227,000) for the same townhouse, but with only 10 percent down and quarterly instalments over eight years instead of four.

Adjusting for Egypt’s double-digit inflation, the extended payments have substantially reduced the cost of the unit.
Economists and real estate agents say most sales have been in the primary market, partly because property developers are prepared to provide finance in a country where mortgage finance is still rare, while the secondary market is relatively dormant.

Still, Yasseen Mansour, chairman of Palm Hills Development, one of Egypt’s biggest private property developers, estimates demand for “high-middle to high-end” housing at up to 90,000 units per year, and that only 24,000 such units were supplied in 2016.
“You have a million marriages a year and 2.5 million people coming into the market every year,” he told Reuters.

Palm Hills in October acquired the rights to develop 12.6 million square meters of desert land 15 kilometers west of the pyramids, where it will develop 37,000 housing units. It will begin selling the units in April or May, Mansour said. This is in addition to more than 7,000 units it is developing in other areas in Egypt.

The average wage for Egyptians, including government and private sector employees, was about 4,000 pounds a month in 2016, according to CAPMAS, putting most new housing well out of the reach of the bulk of the population.
“There is nothing at all active in our country these days except for small apartments,” said Hany Osman, who founded and runs El Shams Real Estate, a high-end estate agency.
He said the typical high-end buyer has been hurt by an economic slowdown since Egypt’s 2011 popular uprising.

“No matter how wealthy, you will find him negatively affected economically. If he’s wealthy, the production in his company has weakened and he has been affected negatively.”

Africa Promises Good Investment Opportunity Says Elumelu at WEF

Mr. Tony Elumelu, group chairman, United Bank for Africa (UBA) and one of Africa’s top businessman, has stressed the need to change the African narrative while concentrating on the myriad of opportunities inherent in the continent, stating that its economic transformation and stimulation should be the focus of all governments and global institutions.

This, he said, is paramount if the continent is to take its rightful position as a strong regional player in the international community, owing to its numerous investment opportunities.

Elumelu, who is the Founder of the Tony Elumelu Foundation, said the time had come for governments on the continent to put things in place to ensure that the continent which has great potential, lives up to it; adding that already, there are signals of the greatness all around.

Speaking during Richard Quest’s programme on CNN  aired on the sideline of the ongoing World Economic Forum in Davos, Switzerland on Thursday, he said; “the time has come for us to prioritise our young ones, who are the future of this great continent. These are the men and women who are energetic in Africa and who can perform wonders if the enabling environment is there.

“We need to get it right with infrastructure in Africa and with the macro-economic policies and environment. And the good thing is that things are gradually falling in place. I think Africa promises good investment opportunities, the problem has always been creating the right environment for it, and this should be our major focus.” Elumelu stressed.

He added that in Zimbabwe, for instance, there have been recent concerted efforts by the government and the people to change the narrative, adding that “I am optimistic about what is happening in Africa right now, because our leaders are getting it right and in fact what has happened in Zimbabwe is also an indicator of great things to come. The fact that they on their own decided to sort things out the way they did, is a new kind of democracy that the world needs to learn from. “There is so much private global capital looking for the right destination, they can go to Zimbabwe as in other African nations, once the right environment is put in place.”

READ: 13 Reasons Why you Should Exhibit at the 12th Abuja International Housing & Construction Show 2018

While pointing out that the blame game which previously obtained in the continent should be done away with, Elumelu called for increasing support from the private sector as well as key stakeholders to make Africa and African self-sufficient.

Throwing more light on this, he said; “We can’t keep talking about missed opportunities. What I keep saying to people is to put an end to the blame game. Let’s begin to fix what needs fixing and get things right. Our government should get it right, the private sector should come forward and we need to support the young African entrepreneurs; create economic hope and opportunities for them.  “We need to think of how to engage Africa in the 21st century because it is no longer about giving grants and aid to Africa, it is more about engaging them in a way that creates self-sufficiency; independence; and reduces the perpetual syndrome of dependence.

Continuing, he said “There is promise; it is getting better because the way this year has started in Nigeria for instance, we have seen market indicators showing good promise, so we are optimistic that it will be better year. The Key is to prioritise things that are important to us to help the continent to grow.”

– Nigeria Communications Week

Infrastructure finance: Expert advocates Infrastructure Fund, non-traditional funding

Following the huge financing gaps that exist in the area of infrastructure finance and traditional funding that cannot cover the long-term needs of most countries, the need for Nigeria to explore non-traditional ways of funding infrastructure has been advocated. This is coming against the fact that government revenue is limited, obligatory spending is higher than the revenues and leverage is too high.

Read: ABUJA INTERNATIONAL HOUSING SHOW – THE LARGEST HOUSING AND CONSTRUCTION EXPO IN WEST AFRICA
Speaking as a guest speaker on the theme: Infrastructure Financing Options in a Challenging Economy, at the International Real Estate Federation, FIABCI-Nigeria, in Lagos at the weekend, Mr. Bode Agusto, a finance expert and an independent researcher and consultant, the new approach to infrastructure financing in the country has become imperative because the traditional way which makes the government to be the sole provider of funds for infrastructure investment and projects will be executed through Government Ministries, Departments and Agencies, MDAs, pointing out that “Under this model, in Nigeria, infrastructure projects become politicised as budgets are approved late. There is a proliferation of projects, scarce funds are spread thinly among the numerous projects and we rarely complete any major project, for instance, Lagos-Ibadan Expressway project.” Agusto who said the Federal Government could create an Infrastructure Fund that it will employ to partner with the private sector for the development of projects with strong economics and huge social impact, added that it can then pay N0.5 trillion annually (about half of what it currently spends) into this fund, set up a strong governance process for managing this fund. He said the fund will make, on average, an equity investment of 25 per cent on each project, set up a company incorporated under the Companies Act to own the project such as the National Grid Plc, while others (local businesses, foreign businesses and IDAs) will own the remaining 75 per cent equity and manage the company. This means that potentially, the Federal Government can invest N2 trillion annually from the infrastructure fund. “Each company will pursue its own project, complete it and bill the public for the use of its services. They will prepare annual report and accounts, subject these to external audits, make these accounts public, hold annual meeting of shareholders, pay tax on their profit and pay dividends out of their profit after tax. The companies can also be listed on the NSE to improve their access to capital. “A principal concern of the government is how the poor and weak in society access these services. In agreeing fares with providers of rolling stock for railway services, government will negotiate subsidies for children, senior citizens and the physically challenged. In setting electricity tariffs, government will estimate the monthly consumption of a poor household and, in agreeing tariffs, ensure that consumption up to that threshold is heavily subsidised. “Subsidies fashioned in this way will not blow a big hole in the budget like PMS subsidy currently does. There will be no need for the government to set the domestic price of gas and they will also be able to agree on electricity tariffs that will allow an efficient player cover its cost of capital. “Can this work? The NLNG is perhaps the best example of an infrastructure project that has employed this model. Nigeria sold 5 per cent of its equity stake in the Shell JV to fund its 49 per cent equity contribution to Nigeria LNG. Three international oil companies own the remaining 51 per cent. The business has thrived, building six trains of LNG largely from internally- generated profits and commercial loans. “A non-traditional way is for the government to partner for infrastructure investment. Partners are typically International Development Agencies, IDAs, local businesses and foreign businesses. All these people want their money back plus some returns.

Therefore, infrastructure projects that lend themselves towards public/private partnerships are those with strong economics, for instance, the national grid and rail transportation. “How can the Government partner with the private sector to fund infrastructure projects? Let us use the Federal Government as an example. The Federal Government makes a list of the key projects that she would like to undertake and divide them into two categories. Category1 will be those with strong economics and social impact e.g. the National Grid, Railway Infrastructure, Railway Rolling Stock, 2nd Niger Bridge; Category 2 will be those with weak economics but strong social impact e.g. water for rural communities, rural electrification,” the guest speaker averred.

Property investors prefer tourist rather than urban areas in Greece

According to the findings of a survey conducted by pollsters Kapa Research for the Hellenic Property Federation (POMIDA), a large percentage of property owners are finding it difficult to pay real estate taxes. Only 21.6% of the respondents said that they would be able to pay the unified property ownership tax (ENFIA) next year, compared to 25.4% who said they were unable to cover the tax. 38.3% responded they would find it difficult and 14.7% refused or did not know what to answer.

The data recorded that most of the property owners received late rents and a significant percentage does not receive delayed rent payments from their tenants, with a large portion not receiving any rent at all. The survey also revealed that the majority of real estate owners reduced rents, subscribing to the notion that it is best to get less than nothing at all. 76% have decreased rental rates over the past three years.

  • 30.2% intend to sell some property in the next two years, while 76.4% noted they do not intend to buy property in the next two years.
  • 76.8% consider property taxes to be unfair, while 63.3% of the respondents argue that leasing property is a net loss.

READ: 13 Reasons Why you Should Exhibit at the 12th Abuja International Housing & Construction Show 2018

Furthermore, a long-standing trend in Greek society where investors valued more urban real estate (Athens, Thessaloniki, large urban centres) seems to have been reversed as an increasing number opt to invest in tourist areas.

Canadian real estate prices see biggest drop worldwide

Canadian real estate prices were the fastest rising in the world, just a few months ago. Now we’re claiming the opposite title, as the market explores where prices should be. Newly released Federal Reserve Bank of Dallas (the Dallas Fed) numbers, show a decline in home prices for the third quarter of 2017. This is the first time in over five years that Canadian real estate prices have declined for a quarter. Despite the quarterly drop, prices still remain significantly higher than the year before.

U.S. Federal Reserve home prices index
The Dallas Fed publishes home price indexes for academics and researchers. Today we’ll be looking at their Real House Price Index (RHPI). It’s the same concept as the HPI that Teranet and the Canadian Real Estate Association (CREA) produce. In fact, they actually use CREA data to create it. They also combine it with data from Royal LePage, Statistics Canada, and UBC. This helps them get a cleaner, and more comprehensive look at the general market.

Read: ABUJA INTERNATIONAL HOUSING SHOW – THE LARGEST HOUSING AND CONSTRUCTION EXPO IN WEST AFRICA

The inflation adjusted score tracks the aggregate of urban markets across the country, and is updated quarterly. You won’t be able to use these numbers to determine how much you have to pay for your neighbour’s house. Instead, you should use these to get a better read on national home buying trends, and the economy in general. Housing is a very large industry in Canada, and a slowdown would ripple throughout the economy.

Canadian real estate prices dropped 3.8 per cent in Q3
Canadian real estate prices dropped the most since the early 1990s, according to the the Dallas Fed. Real home prices, a.k.a. home prices adjusted for inflation, fell 3.8 per cent in the third quarter of 2017. The single quarter decline is the first drop since 2012, and the largest since the first quarter of 1991. This is the largest single quarter decline in the world according to the Dallas Fed’s global index. The second largest decline they observed was in Italy, where prices fell 0.38 per cent in the quarter.
Canadian real estate prices are still up more than seven per cent annually
Despite the large quarterly decline, Canadian real estate prices are still much higher than they were a year ago. The index is up 7.4 per cent from the same quarter last year, almost twice as much as the aggregate index for other countries. The increase is quickly tapering from peak growth observed in the first quarter of 2017. The quarterly decline is significant, but even so, the market is outperforming many other markets.
Remember that a single data point isn’t indicative of a trend, but the size of the decline is worth taking note of. This marks a break in the five year upward trend the country has seen, and might just be a breather, like in 2012. It could also be the beginning of a broad market correction, like that seen in 1990. The most interesting takeaway is this break occurred starting six months before OSFI mortgage rules were rolled out to cool conventional mortgage borrowing. The rule changes add significant uncertainty to the market, especially after prices are starting to look a little softer.

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