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Real estate: How to buy and sell at the same time

There are times when there is a need to make a strategic move regarding your real estate investment holdings. One of such strategic moves is buying and selling of a piece of real estate simultaneously or as near to this as possible. Strategic moves are for those who already own at least one real estate investment property but the information might also prove useful one day to those new in real estate investment.

Like someone said, the only constant thing in life is change. Buying and selling real estate almost simultaneously is an art worth learning.

The primary reason why a person might want to sell their real estate investment property and buy another one is usually due to a change in circumstance. This is a broad reason that can accommodate a lot of scenario. A change in circumstance could be in relation to the purpose of the property that is about to be sold. Take the true case of a very successful businessman who built a mansion of about twenty rooms with several meeting rooms, swimming pools and other amenities.

In his reasoning at that time was the need for a place that could host multiple meetings, personal functions and other family events. Twenty years after the children have moved on, he and his wife are older, and the house has now become a burden. Their decision to downsize to a more manageable home was a core reason why they wanted to sell the house and buy a smaller one.

Another reason could be that the location has now changed and provided you with an opportunity to make money that could be put to better use. This was the case of an investor who suddenly realised that where he was living was rapidly turning into a high-street for banks. The value of his property shot up astronomically while the area changed from its naturally quiet and peaceful environment to a noisy commercial area. He was approached by one of the banks and he made so much from the property sale that he was able to relocate to a more serene location and still keeps a good profit.

Downsizing might also be forced on an investor by the need to access the equity in the property, buy a cheaper one and access the extra capital. It is also possible for an investor to have extra cash and be willing to add all the funds coming in from the sale of a property in order to buy an investment property in a better location or with better prospect of a higher return on his or her investment. Navigating this season requires clarity, focus and discipline. If a person is careless at this stage it could mean losing his or her property and losing money.

It is always better to begin this journey with clarity as to why you want to sell and what you want to buy. If you have a team of professional and experienced advisers this is the time to discuss with them. You must have a clear road map before the money gets into your hand or you can easily be distracted. This is a good time to get your facts right and avoid assumptions. You should have a clear idea of how much your property is worth, where you would like to invest some or all of the money and what is the value of properties in your desired area. These are information that you should also reconfirm just before you make the sale.

It is highly recommended that you start with the sale first. Real estate is notoriously an illiquid asset. It is not easy to convert a real estate asset into cash in the same way that you do with shares and stocks. It usually requires marketing, waiting and negotiating before closing. You cannot specifically state when a property will be bought. It is therefore better that you are certain of the sale before you start negotiating with the seller of another property. If you put the purchase before the sale,  unless you have access to other sources of financing you might not be able to close those deals and also leave a long list of disappointed sellers on your track.

Astute real estate investors are decisive and discipline. You should be clear as to what you want to buy before the purchase price gets into your account. As much as possible avoid a situation where you have made the sale but the purchase is lingering for months. The temptation to overspend and be distracted from your original goal can be too great. Let the transactions be as close as possible to each other.

Source: Abiodun Doherty

The Real Estate Market, today and the future

You may have noticed the real estate market tightening and slowing in recent months. Homebuyers are becoming increasingly more cautious due to the feeling that they may be purchasing at the top of the market and will have to obtain a higher market interest rate compared to the past. This also translates to buyers being more difficult to secure in the marketplace for home sellers. This, in addition to an ever-rising interest rate market, is leading to more compression and more competition from lenders. And as the fight for consumers becomes ever more challenging, homebuyers who are in the market become ever more competitive to land for lenders. The fight for purchase business continues.

The Current Market

As many consumers have noticed, the current real estate market remains at a plateau. While we continue to see homes being bought and sold at a standard rate in the conventional markets, the move-up buyer — someone who buys a house that is larger and more expensive than the house they already own — is almost like a ghost.

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As interest rates climb and housing prices stay flat, the move-up buyer market will not gain traction. The reason for this is very simple: Most people who currently find themselves in a good equity position in their home and purchased their home between 2012 and 2015 are scratching their heads. Those who do want to potentially move into a home in a better location, or want more square feet or updated finishings, are pondering if it’s really worth the move.

And here’s the conundrum: If they purchased their home in 2011-2013, and that home was $500,000 and is now worth $800,000, and their current budget is $1.1-$1.3 million, they may be asking themselves, “What do I really get?” The answer is not much more. This is because a home bought four or five years ago has seen significant appreciation. Therefore, even with a higher budget today, what they can buy doesn’t yield much more than they already have.

Even though the budget is on the higher end, consumers may find themselves saying, “If this is all I get for this amount of money, I think I’d rather stay in my home.”

More importantly, the current interest rate they are paying may be in the mid to upper 3% range, yet current rates are looking closer to 5%. Facing the possibility of getting out of an incredible interest rate to jump up to 100-150 mortgage points, thereby increasing their monthly expenses significantly even if their loan amount stays the same, smart consumers are saying, “No. I’ll stay in my home. Maybe we’ll remodel it.” And that’s what I’ve observed across the board.

Looking To The Future

Consumers are hesitant in the current market — not with only with what is available compared to what they have to spend, but even more importantly, getting out of an all-time rock-bottom low interest rate in exchange for a higher interest rate.

For consumers in the FHA and conventional markets, we see demand continuing to be rather strong — maybe not as strong as in years past, but still a solid market. In the high-end luxury market, we are predicting a little slow down, but that market as well should remain decent over the next 12 months. This opinion and prediction is based off of the historical ebb and flow of the luxury market, in addition to high interest rates.

However, what’s hurting the market right now is the move-up buyer. Particularly in the Arizona market, for example, the move-up buyer from $500,000 to $1 million seems really hard to find. These homes are sitting on average over 130 days longer than I saw them listing for last year. This is happening because encouraging the move-up buyer to take on a higher interest rate for a larger home is not sustainable. The move-up buyer wants to stay where they are in this scenario. They are more interested in investing money into a home for a remodel, or even an addition, rather than taking on the cost of moving and a higher interest rate.

The only solution that would help this situation would be for interest rates to lower. This move-up buyer hold-out could damage the market because it initiates a sort of freeze where homes aren’t going on the market and buyers aren’t interested in looking for newer or larger homes. This causes a slow market without a lot of turnover.

Generally speaking, the market tends to cool this time of year as the leaves fall and temperatures drop as well. There is nothing to be alarmed about at this time, but awareness of the current climate is key to making the best decisions for all.

Source: Jason Mitchell

2019 Real Estate Forecast: What Home Buyers, Sellers And Investors Can Expect

There’s no doubt about it: the 2018 housing market has seen its ups and downs.

The year started with sky-high home prices, historically low mortgage rates and a definitive upper hand for sellers. In recent months though, home price growth has faltered, rates have risen to their highest point in nearly eight years, and favor has started to shift from seller to buyer.

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Will these trends continue? Will housing experience the same wild ride in the new year? Here’s what experts predict will happen in 2019 real estate market:

Mortgage rates will continue rising.

“Despite steady climbing for the past two years, mortgage rates remain lower than they were during most of the recession and below average for the type of strong economic growth we’ve been experiencing. That will change in 2019, as the 30-year, fixed rate mortgage reaches 5.8% — territory not seen since the dark days of 2008 when rates were racing downward in response to the housing crisis.” — Aaron Terrazas, director of economic research for Zillow

Millennials will keep buying home — despite those rising rates.

“The housing market in 2019 will be characterized by continued rising mortgage rates and surging millennial demand. Rising rates, by making housing less affordable, will likely deter certain potential homebuyers from the market. On the other hand, the largest cohort of millennials will be turning 29 next year, entering peak household formation and home-buying age, and contributing to the increase in first-time buyer demand.” — Odeta Kushi, senior economist for First American

“Millennials will continue to make up the largest segment of buyers next year, accounting for 45% of mortgages, compared to 17% of Boomers, and 37% of Gen Xers. While first-time buyers will struggle next year, older Millennial move-up buyers will have more options in the mid-to upper-tier price point and will make up the majority of Millennials who close in 2019. Looking forward, 2020 is expected to be the peak Millennial home buying year with the largest cohort of millennials turning 30 years old. Millennials are also likely to make up the largest share of home buyers for the next decade as their housing needs adjust over time.”- Danielle Hale, chief economist for Realtor.com

Source: Aly J. Yale

Swiss office real estate market thriving

The office real estate market in Switzerland is enjoying a positive outlook, driven by economic recovery and accompanying job growth, according to a Credit Suisse studyexternal link report.

Credit Suisse says office space is now playing a more prominent role than residential housing in leading a recovery in the real estate market.

Following an “exceptional” performance by the Swiss economy in 2018, employment growth has increased significantly – especially in the corporate services, health, and information technology sectors – which has reinvigorated demand for office space.

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The growth represents a rebound from last year, which saw these sectors lose some 10,000 jobs, the report states.

Meanwhile, traditional office sectors like financial services, wholesale trade and telecommunications are still seeing reduced employment and are no longer driving demand for Swiss office space.

The growing demand has been seen mainly in the office markets of large urban centres, which are being targeted by “companies seeking to position themselves as attractive employers for skilled labor”, according to Credit Suisse.

Source: Keystone-SDA/swissinfo.ch/cl

Who is to blame for real estate scams in Lagos?

Housing is one of the basic needs of all humans. Over the years, the surge in population of the nation’s commercial centre, Lagos, has assumed exponential proportions. Unfortunately, the provision of urban infrastructure and housing to meet this growing demand is not at commensurate level.

In the real estate business chain, there exists a group of ‘professionals’ that play a big role and due to high demand for their services, many Lagosians have fallen victims of their sharp practices.

Effiong had just moved over to Lagos from Akwa-Ibom, a state in the southern region of the country, and like several young school-leavers seeking the proverbial greener pasture, he was faced with no other option than to stay with a friend who already had an apartment around Iyana Ipaja, a suburb of Lagos.

After a few months, he felt the need to get his own apartment, even if it meant getting a single room where he could rest his head after a stressful day at work. So, he started saving a part of his monthly meager salary. Effiong later approached a roadside house agent who promised to get him a single room apartment in Bariga, a densely populated area in Lagos. After an inspection visit to a one-bedroom apartment and being satisfied with the relatively decent environment, Effiong paid for one year’s rent and was eager to move into his new apartment.

On the day he was to move in, Effiong received the biggest shock of his life. The room already had a new occupant! A visibly angry Effiong approached his house agent to know what had happened. The agent apologised to him and promised to get him an even better apartment. Effiong thereafter requested a refund of his rent, which the agent readily agreed to, but pleaded with him for some time. It’s already six months and Effiong is yet to get either a room or the refund of his money.

Effiong’s experience is just one out of several scams pervasive in the real estate sector — from the small players in the business value chain (roadside agents and caretakers) to the big players, such as private property developers and home builders in the industry.

Femi recalled how his room was burgled few days after he moved into his apartment. All efforts to get a refund from the landlord and his agent earned him a serious beating by touts allegedly sponsored by the landlord who had vowed never to refund his money to him.

Lagosians recently woke up to the news that a cross-section of homeowners at Horizon Premier-1 Estate in Lekki, an upscale part of Lagos, have dragged the Management of Lekki Gardens Estate Limited, and its Managing Director, Richard Nyong, to a Lagos High Court over the alleged distortion of the estate layout to build shops in the space originally meant for a children’s playground, green area and recreation facilities within the estate.

The homeowners, in a suit filed at a Lagos High Court, are demanding an immediate reversal to the original estate layout, which suffered over two years of delay in delivery— a default for which the subscribers are also demanding compensation.

Also, residents in its existing Lekki Gardens estate have complained bitterly about the atrocious state of facilities, and complete lack of maintenance. Some also complained about poor workmanship on some of the buildings, such as cracks on the wall, while some others complained about disjointed pipes.

 Scams in getting access to land and permits

The World Bank, in its Ease of Doing Business Series in Nigeria, ranked Lagos State as the worst place to secure construction permits in the country. The fear of falling into wrong hands and getting fake title documents has forced several people and investors hoping to own a house or build a factory in Lagos, to seek alternative locations such as neighboring Ogun State, to avoid falling into the hands of scammers and street urchins, popularly called Omo-Onile.

The increase in the number of reported cases of sharp practices in the real estate industry has waned investors’ confidence in the sector and out of curiosity, Nairametrics seeks to find out where the fault lies.

Blame Nigerian’s love for cheap things and greedy developers

It is not uncommon to see giant billboards on major highways across Lagos and flyers advertising housing units and lands at mouth-watering discounts and unbelievably low prices, all with the aim to attract buyers.

In an interview with Nairametrics,  Mr. Nnamdi Ijei, Chief Executive Officer of Highrachy Investment & Technology Limited, noted that Nigerians looking to buy property must always carefully seek and patronise professionals in the industry.

“No professional that has his name to protect will involve in any shenanigans or shady deals that will tarnish his image.”

He added that developers should always put into consideration the quality of building materials, the convenience of the structure for homeowners, and its impact on the environment when designing and planning their building.

According to Dr. Opaleye, an occupant in one of the newly built estates in the Lekki area of Lagos, developers are very greedy as most of them fail to deliver on time as promised. More worrisome is the fact that many of them use substandard building materials and even poor workmanship which are often covered with flashy paint coatings and aesthetics to conceal the defects.

“If you visit my house, you will see the poor job done. They don’t even deliver to the initial specification. Some of them will promise you a spacious compound and sporting facilities in the housing units but years after the completion of the house they are yet to construct any sporting facilities in my estate.”

Navigating through the mine field of dodgy real estate agents

Ms. Ellen Abada is an Executive Marketer at a real estate firm and she believes that most people usually ignore the red flags at the initial stage. She noted that real estate is a huge investment and anyone putting down his/her money must have a proper knowledge on how the industry works.

She, however, advised that anyone who wants to rent a room must request to be taken to the landlord of the building to avoid stories that touch, noting that some tenants even sign agreements without considering the future implications of such agreements.

A lawyer, Barr. Makanjuola noted that the Lagos State Tenancy Law 2011 was introduced to regulate the relationship and in particular, the rights and obligations of tenants and landlords under Tenancy Agreements, and the process for the recovery of premises and other related purposes.

He further advocated for proper education before signing any agreement with private developers and advised tenants to approach the Rents Tribunal in the state which is an alternative dispute resolution mechanism to resolve their rents issue.

Source: Fikayo Owoeye

Indians Biggest Foreign Investors In Dubai Real Estate: Report

MUMBAI: Expecting high returns, Indians have invested hugely in Dubai realty in the first nine months of 2018, making them the largest chunk of all foreign investors in the sector, according to the latest statistics of the Department of Real Estate Studies & Research, Dubai Land Department (DLD), said a spokesperson on Tuesday.

Eyeing profits, Indian nationals have already poured a staggering Rs. 16,800 crore in various realty projects in the emirate, which is also a global financial centre.

In fact, the DLD said Indian buyers have been consistently the highest foreign investors in the emirate”s realty sector given its strategic location, high investment and rental yields, capital appreciation and regulations making it an attractive proposition.

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“We expected these numbers to pick up further at the upcoming DLD’s annual 4th Dubai Property Show (DPS) coming up in Mumbai from Dec 7-9. It will showcase exclusive Dubai real estate options with participation of renowned developers such as Nakheel, Falconcity of Wonders, Sobha Realty, Geminit Property and others,” company spokesperson said.

On offer will be budget to luxury apartments, villas to beach properties, furnished homes and commercial properties. It will bring together Dubai’s real estate experts, developers and consultants under a single roof for interaction with potential Indian investors.

Globally, the Mumbai event will the 10th edition of the exhibition which has travelled to London and China this year, DPS General Manager Himanshu Gupta said.

He said Indians have been living in Dubai for decades and contributed immensely to the business and economic growth of the country, with great optimism for the future.

Moreover, for Indian investors, Dubai is like a home-away-from-home given its familiar environment, close proximity to India, fantastic growth opportunities and increasing trust in the systems, Mr Gupta added.

Source: NDTV


Florida City for Foreign Homebuyers

Miami retains Florida’s top target city for foreign buyers in 2018

According to the National Association of Realtors 2018 Profile of International Residential Real Estate Activity in Florida, Orlando held steady in 2018 as the #2 destination of choice for Florida’s international homebuyers. Nine percent of all of Florida’s international homebuyers opted to purchase a property in Orlando.

“The international real estate market is important to the sustainment of both Orlando’s real estate industry and its overall economy,” says Orlando Regional Realtor Association President Lou Nimkoff. “The profile’s results show that foreign buyers accounted for approximately 11 percent of the Orlando-Sanford-Kissimmee Metropolitan Statistical Area’s 44,000 home sales during the study period of August 2017 through July 2018.”

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Orlando was Florida’s second most desired destination of foreign homebuyers in 2018 and captured 9.4 percent of the state’s market share (11 percent in 2017 and 12 percent in 2016). Only the Miami-Fort Lauderdale-Miami Beach area, which drew a whopping 53.7 percent of all Florida international transactions, topped Orlando. The Tampa-St. Petersburg-Clearwater area came in third with 9.0 percent. Those rankings are unchanged from both 2017 and 2016.

Buyer Originations

Orlando area international buyers in 2018 were mainly from Latin America and the Caribbean (47 percent), Europe (18 percent), and Asia (15 percent). From a nation-centric perspective, those from Brazil were involved in 20 percent of Orlando’s international transactions, while Canadian and Venezuelan nationals participated in 8 percent each. China, Columbia, and the United Kingdom each supplied 7 percent of Orlando’s international buyers in 2018.

Several countries made their first appearances on Orlando’s list of major foreign buyers in recent years: the Dominican Republic, Bolivia, France, and the Russian Federation.

Popularity Rankings

Orlando was ranked as the #2 collective purchase location for international homebuyers from four of Florida’s six top foreign buyer markets in 2018. This year Orlando garnered the #3 spot from the United Kingdom, which in 2016 drew 29 percent of all of that country’s Florida real estate buyers and earned its #1 ranking.

Financial Matters

International buyers contribute significantly to Orlando’s dollar volume statistic. “Foreign buyer purchases tend to involve higher priced homes and accounted for 19 percent of Florida’s total residential dollar volume during the study period,” continues Nimkoff. “That same 19 percent equates to $1.9 billion when applied to ORRA members’ $10.1 billion worth of home sales during the study period.”

International buyers are also very apt to use cash because they might not have the required U.S. credit to obtain a mortgage from a U.S. source. In fact, about 67 percent of all Florida’s international transactions in the study period were all-cash (down from 72 percent last year), with Canadians (84 percent) and United Kingdom nationals (81 percent) most likely to have gone that route.

Orlando’s international buyers purchase properties for both vacation and residential rental purposes. Those from China, Columbia, and Venezuela in particular like to take advantage of Orlando’s steady stream of tourists and invest in a rental property while those from Canada and the United Kingdom were most likely to purchase a property for private vacation use.

With its mix of resort, urban, and suburban areas, Orlando is able to accommodate foreign buyers’ ever-changing location preferences. Thirty-seven percent of Florida’s international buyers selected to purchase in a central city/urban area, with another 37 percent selecting a suburban area. Only 15 percent purchased in a resort area during the 2018 study period, down from a high of 53 percent a decade ago. This drop is consistent with the declining share of Canadian and U.K. buyers, who have traditionally preferred such locations.


JVs, crowd-funding advocated as viable real estate financing options

Joint venture arrangements, crowding funding and off-plan sales are some of the viable alternatives to funding real estate projects in Nigeria where cost of funds has made bank credit both inaccessible, unaffordable and unattractive, experts and industry stakeholders have said.

The experts explained that one of the biggest challenges facing players in Nigeria’s real estate sector is the accessibility and affordability of capital to finance development projects. Commercial banks are not an ideal or suitable medium for financing real estate projects because whereas commercial bank deposits are short-term in nature, real estate is for the long term which is usually vulnerable to the vagaries in the economy such as changes interest rates, exchange rates, and the rate of inflation.

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“Nigeria is still a viable market. Capital is a challenge but deals are happening. It means funds are available. Players in the industry are making use of other financing options to fund real estate development projects,” said Andrei Ugarov, partner at PricewaterhouseCoopers (PwC) at the Refined Investor Series 2018 organised by Fine and Country West Africa in Lagos Tuesday.

Some of the financing options available include equity partnerships, pre-sales, debt financing, public-private partnerships and mezzanine structure. Companies such as Mixta Nigeria, UPDC and Landmark are local developers who have leveraged on partnerships with foreign firms to finance projects.

The Maryland Mall is an example of a successful partnership. The Wings Towers is another high profile and very visible office space that is also a product of partnership between Oando and RMB Westport.

To deal with challenges associated with funding, stakeholders in the industry are encouraged to focus more on resourcefulness and to see real estate as a collaborative venture it really is.

“One of the trends we see in the real estate is pre-financing or pre-sales financing. This is a situation where end-users pay their rent upfront to enable the company get capital to fund a project. This model of financing is very innovative,” Ugarov said. “End-users, in this case, carry more risk burden,” he noted.

Udo Okonjo, Fine & Country’s CEO/Vice Chair, highlighting the theme of the series, ‘Collaborating for New Heights and National Growth’, stressed the need for collaboration in environment where credit is dry and risk is high, hoping that gathering would act as a catalyst to create winning collaborations among stakeholders so that Nigeria could grow its economy.

“The case for collaborating in real estate cannot be stronger than now with a sluggishly recovering economy, where there’s not only massive infrastructure and protracted housing deficit, but also huge amount of underutilised and idle asset,” Okonjo said.

But Fabian Ajogwu, managing partner, Keena Partners, warned of possible pitfalls of even the best joint ventures, advising that before entering into any joint venture agreement care must be taken to find out, among other things,  the strength of the project, legality and structure of the development or business, the developer’s credit history, etc.
On the developer’s side, Ajogwu advised further that care must be taken to avoid project cost over-run, point out that the implications could be grave as it has the capacity to change the story of that project completely.  “Challenges will come from the financiers, off-takers, contractors and a lot more stakeholders”, he said, adding, “cost over-run can make investors see the project executor unreliable and untrustworthy, and this can affect future projects,” Ajogwu said.

According to him, industry players can mitigate this risk he recommended insurance.“Developers can take up insurance to deal with cost over-run. They will have to pay premium which is  cost to cover the risk. Risks involved in project developments are insurable,” he said.

Earlier in his opening remarks, Frank Aigbogun, CEO, BusinessDay, had given insights into where Nigerian economy would be headed going into 2019, pointing out some macro-economic factors that real estate and property investors might face in 2019.

“The first thing I see going into 2019 will be exchange rate management and dollar liquidity issues. We recovered from an economic recession not too long ago and it seems as if there is another one by the corner. Currently, oil prices are not looking too good. With the dollar scarcity back what direction will Nigeria foreign reserves go? The Central Bank of Nigeria desires to protect the naira and foreign reserves is critical,” Aigbogun noted.

He added that in the coming year, Nigeria would be dealing with infrastructure problem. “Nigeria is dismal when it comes to this; its capital formation, according to World Bank, is 13 percent to GDP, China is around 40 percent and India has an excess of 30 percent. China has rolled out infrastructural plans to expand economic activities”, he said.
He was of the view that, though there is GDP growth, the economy is expected to end flat at 2 percent in 2018.”Currently, consumer spending is very weak and, unfortunately, the reforms to change this are not happening”, he noted, hoping however that no matter how things are happenings, major deals will happen next year.



Experts predict further dip in real estate market

A combination of heightened uncertainty and eroding affordability is expected to cut into demand and contribute to a weaker real estate market in 2019, and 2018 harsh economic realities made the sector to underperform in terms of yield and returns, according to industry experts.

While the economy remains weak, demographic fundamentals remain strong, lack of clear policy in 2018 impacted negatively on prospective homeowners access to mortgage financing in the market.

Notably, mortgage interest rates are also on the rise, further reducing buying capacity. As the activities of the Nigeria Mortgage Refinancing Company (NMRC) are yet to be felt in the market, the high interest rate are expected to further stabilise in 2019, which may worsen borrowers ability to qualify for financing.

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Unfortunately, it is expected that headline inflation will continue its climb upwards as a result of spending for the 2019 elections; the Central Bank of Nigeria (CBN) closed off Q3 at NGN 305.85 / USD at the CBN window, a depreciation of 85 kobo from the rate recorded at the end of Q2.

The International Monetary Fund (IMF), in its October edition of the World Economic Outlook report, reduced its 2018 economic forecast for Nigeria from 2.1per cent to 1.9per cent whilst in the same month the WB reduced its 2018 economic growth forecast for Nigeria from 3.1per cent to 2.7per cent. The IMF also adjusted its projected inflation rate for 2019 from 12.4per cent to 13.5per cent. Other economic figures indicate that Nigeria’s external reserves declined to $44.30 bn at the end of September, the lowest in six months.

“A possible implication is that a constant depletion of the nation’s reserves may lead to further depreciation of the naira against the dollar, further impacting on the real estate sector which is heavily reliant on the capital markets,” according to International Real Estate Partners (IREP), third quarter Commercial Market Outlook.

Specifically, on the performance of the markets in 2018, there were divergent opinions by the professionals. Some say, the rate of sales for both new and existing properties are nose-diving; others noted that the sector has generally been fairly stable.

IREP Chief Executive Officer, Mrs. Erejuwa Gbadebo said: “Investor appetite and confidence remains weak, and records show that because buyers who can afford to buy real estate are being extremely cautious with their investment spending, there is little money in circulation for major capital projects.”

For Mr. Chudi Ubosi, an estate surveyor and valuer, “residential has been stable with rents in many areas experiencing no increases. The general attitude has been at renewal, to keep the present tenant if it means reducing rents or throwing in sweeteners to encourage them to stay.

“Fresh residential lettings have been slow and this is as a result of the economy as well as many landlords still not coming to terms with the harsh economic realities.”

In fact, the Chairman, Royal Institution of Chartered Surveyors (RICS), Nigeria Chapter, Mr. Gbenga Ismail said, “residential is still in high demand but sales are very low retail and office suffered significant value reductions.”

He heaped the blame on the non -performance of the economy, “the economy is the single factor. It slowed down and lack of liquidity.  Investment in the treasury is as serious issue affecting investment.”

Ubosi, the principal partner, Ubosi Eleh and Company corroborated Ismail’s view that retail has also been slow. But added: “Rents are not on the increase and have been more of the time stable. Landlords and agents are devising new means of keeping tenants to reduce void in their premises.”

However, IREP in its report said that despite stiff competition from small retail centres, the larger malls continue to reconfigure themselves to provide consumers with every recreational, entertainment, educational, fitness and shopping they would need; a recent example being the integration of cinemas at Circle Mall in Lekki.

“New small retail centres however, continue to spring up, especially along the Lekki corridor, with a high demand for the ground and first floor; often taken up even before completion. Existing centres are also experiencing increased occupancy rates and though welcome, this has added significantly to the congestion in surrounding areas adding to the fear of decline; clearly a trend to watch.”

Gbadebo disclosed that the conditions in the office segment remained relatively stable; construction work on prime commercial properties is ongoing, although for some, activity has stalled. “The commercial office space is gaining a new entry with the proposed Dangote Building on Alfred Rewane Road, Ikoyi, whilst the iconic IMB Plaza renovation, set to deliver over 8,000 m2 of space in 2019, continues apace.

“Asking rents in Ikoyi and Victoria Island remain constant at $700 and $600 respectively, with prospective tenants who require larger spaces, having the added advantage of reasonable concessions in rent. Q3 also saw the 12,000 m2 Kingsway Tower development put up for investment sale.”

The experts agreed that the industrial sector has been very badly hit in 2018 with many premises coming into the market either for sale or lease without any takers in sight.

Expectations are also high on the Nigeria’s forthcoming elections. IREP said: “Whilst oil prices rose, Nigeria is dealing with heightened uncertainty in the 2019 elections. Many investors / decision makers are adopting a “wait and see” strategy and some foreign investors have withdrawn their funds in order to mitigate against any political risks that might lead to a loss of investments.

“These reactions are predicated by the somewhat un-healthy relationship that has developed over the years between Nigerian politics and its economy; many policies adopted during one political tenure have a detrimental effect on those taken in previous tenures.

“Projects are stalling at the feasibility stage and the stock market is already feeling the sting of pre-election frenzy with stock prices plummeting due to pressure selling by shareholders.But most worrisome is the continued fall in oil prices. The total contribution of the oil sector to real Gross Domestic product (GDP) is fast declining whilst the non-oil sector’s contribution is rising.”

Ubosi submitted, “The outlook in 2019 does not look good. “As it is, oil prices are falling with dire implications for the nation’s income. Politics and elections are round the corner, with the do or die mentality that Nigerian politicians bring to the table, it will scare away investments and in the long run slow down the economy.”

Source: Chinedum Uwaegbulam

Women surveyors charged to uphold ethical standards

Women in the surveying profession have been charged to abide by the rules of the profession in the course of carrying out their assignments. This will go a long way to lift the standards of the profession.

In his speech at the 1st Annual Lecture series of the Nigerian Institution of Surveyors,organised by Women in Surveying (WIS) Association,the Managing Partner, Remi Olatunbosun &Associate, Mr Olatunbosun David,  urged women surveyors to carry out their vocational practice with adherence to the law of the land without denying anyone of his or her inheritance.

Speaking on the topic “Will and Inheritance’’, David said that to avoid being attacked at sites, surveyors should ensure that clients demanding for land survey have legal right over the land they want to survey.

He added that surveyors should also ensure that all the land they surveyed were signed by a registered surveyor and registered at the land registry; and obtaining necessary documents as proofs.

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According to him, there should be no connivance between surveyors and land grabbers to subvert people of their inheritance and possession. “Survey practice is very risky at times. Please avoid risk of life because of personal or client’s interest.

“Avoid clash points. Do not risk your life because anyone wants to buy or sell land. Do not risk your life because someone wants to inherit or pass land inheritance to anyone and do not risk your life by supporting land grabbers,’’ he said.

Earlier, the Coordinator, Nigerian Institution of Surveyors, Women in Surveying (WIS), Mrs. Folashade Kasim,  has enjoined females in the built environment to show some ethical behaviour and practices in the pursuit of their professional careers.

Kasim gave the advice on Friday at the 1st Annual Lecture series of the Association in Lagos with the theme:

“Changing Times: What You Must know As a Female Surveyor’’. She said that women in the developed world were aware of their place in the society and particularly in their chosen careers.

According to her, the built environment professions are still overwhelmingly male -dominated, especially at the more senior levels. “It is here in the third world that women are looked down on and belong to the other room.

But in real life, women are now occupying their rightful place in the nation-building and are being empowered to conduct themselves well.

“To end this, it becomes imperative to the young professional women to know what is expected of them in the society and basically their contributions to the development of the nation,’’ Kasim said.

Source: sunnewsonline.com
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