A Professor of Estate Management and Valuation at the Federal University of Technology, Minna, Niger State, Oluwarotimi Kemiki, has called for incentives for private developers investing in infrastructural development and management.
He noted that environmental facilities, which are often overlooked, have a significant influence on property value in any location. He stated that challenges to infrastructure provision include lack of strategic vision and weak institutional structure, undue political interference, uncoordinated good policies, public attitude toward urban infrastructure; a high cost of provision, corruption and poverty.
Kemiki, who delivered the 103rd inaugural lecture of the university, tagged: ‘Property Value: What is Behind Six is More Than Seven’, emphasised that there should be conscious efforts to develop policies for environmental facilities provision and maintenance in Nigeria’s rural and urban areas.
He suggested that estate surveyors and valuers should be accorded relevant recognition in infrastructural development and management.
To him, the solutions to present infrastructural deficit include harnessing the benefits from other sources of funding, budgetary control, institutional reform and adopting a strategic vision for infrastructure provision.
He listed other solutions as improved regulatory framework, resource allocation across urban and rural spaces and provision of infrastructure before erecting homes.
According to Kemiki, there are other factors influencing property value beyond the building types and finishes. He said: “Environmental facilities have a significant influence on property value. This lends credence to the idiom, ‘what is behind six is more than seven’ in terms of property value. The degree of influence varies from location to location, depending on the level and quality of infrastructure. Property negatively affected by water, noise or other types of pollution tends to be transacted at a lower price, resulting in reduced investment returns. Property within neighbourhood of high-quality infrastructure commands higher values.”
Kemiki, who is also the assistant national secretary, Nigerian Institution of Estate Surveyors and Valuers, observed that renter families are more prepared to pay higher property values in areas with high levels of public infrastructure than in areas with low levels of infrastructure supply.
The University don explained that property value is a crucial aspect of real estate markets around the world, which is determined by a variety of variables whose identification is important for property valuation. The variables determining property values, he said are classified into categories: environmental, neighbourhood, accessibility and property variables.
He lamented that basic infrastructure has suffered neglect over a long period of time in many Nigerian cities, while availability of infrastructure is typically one of the variables influencing demand and choice of real estate property, particularly residential units.
Kemiki said: “ Man is a socioeconomic being who seeks to reside in a shelter that gives the largest supply of necessities at affordable costs. The property value in the centre of the city will command the highest prices as most infrastructure and services are found within the central business district. However, as one moves away from the centre to places with fewer facilities, it will be observed that the value will keep reducing.”
The man-made component of the environment, which usually comes in the form of infrastructure, covers a wide range of services and facilities including water, roads, waste disposal, drainage, communication, primary health services, schools, and housing. The effectiveness of any type of human activity on the environment is heavily reliant on the availability of efficient facilities.”