Like other industries in Nigeria, the real estate industry is in no way free from challenges that hinder its growth. Policy makers and industry watchers are convinced that despite these challenges, the real estate industry can become a major driver of the Nigerian economy.
At present, the industry is plagued with challenges of impostors who parade themselves as real estate professionals in the country. Other concerns are lack of funds and the looming irregularities or unjustified property price and valuation which makes it harder for consumers to enjoy full benefits of patronizing the industry in Nigeria.
If these problems are not adequately tackled, the growth of the industry in the forthcoming post-economic crisis will be stifled. It has also been suggested that unless the federal government actively give attention to the issue of governance and equitable regulations, the repositioning of the real estate industry in Nigeria may be unrealistic.
Lack of funds is the number one challenge facing the real estate business. Fashola Olusayo, a real estate and property development agent, claimed that banks are not ready to lend any more as was the case in the past. Gone are the days when the banks actually anticipate funding real estate projects. In view of the recent unsavoury incidents in the banking industry, such loans are hard to come by.
“Before, if you have a property that you desire to buy, you could approach the banks and get soft loans. If you have a land in a prime area that you desire to buy, you may not have adequate funds to do so.
Probably, you may be able to buy a land but not have the funds to erect a building on it. In these cases, the banks come to the rescue.”
According to him, people made profit by borrowing from banks and investing in prime areas. Thus, they would sell the property in a few years and get good returns on their money.
On the issue of impostors who fraudulently collect money from clients, he said, “Some of these practitioners that you see around are not honest. They just start the business because they know that they can make money from it. We have often received negative comments on this issue and it puts us in bad light but the Nigeria Institute of Estate Surveyors & Valuers is doing something about it.”
Olusayo maintained that the House of Representatives should promulgate an act to monitor agents and landlords by means of a special type of task force. He said that this is needed because once an act has been promulgated into law in Nigeria, it soon gets discarded. However, with the task force well-equipped and maintained, a better business climate would exist for both practitioners and clients in the real estate.
In addition to this, he believed that once the act also sets the range of property price in each area or district, landlords and agents will not be able to increase property prices arbitrarily in all parts of the country. The onus, according to him, is to discourage property price hike by landlords and agents.