Banking reforms needed to grow real estate —Expert
The Chief Executive Officer, Lead Capital Plc, Prince Abimbola Olashore, has said that to unlock opportunities in the country’s real estate market, the financial sector has to be reformed.
Olashore, who is also the Chairman, Board of Trustees, Olashore International School, stated that fair banking practices had to be adopted and better supervision must be focused on.
“This will also stabilise prices in the long run and help to utilise the 17 million deficits in the real estate market, which represent a huge opportunity,” he said.
While presenting a paper entitled: ‘Unlocking the opportunities in the Nigerian residential real estate market: The investor’s perspective’, at a forum recently organised by Lekki Gardens Estate Investment in Lagos, Olashore said the opportunities in the sector lie in the increasing population growth in which more than 80 per cent of Nigerians lived in settlements.
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He said, “Opportunities in real estate financing can be seen from the increasing population growth, rapid urbanisation and the growth of the middle class have spurred demand for real estate, with the level of housing at only two dwelling units per thousand people, compared to a rate of 8-10 dwelling units per thousand people as recommended by the United Nations.
“Nigeria has a population growth rate of three per cent and a rural-urban migration rate of five per cent per annum. The rate of housing demand continues to exceed supply, presenting ample opportunities for growth and development.”
Olashore said Africa was an emerging market filled with opportunities for healthy returns due to the increasing growth fundamentals.
He noted that the Eurozone crisis had slowed down growth and weakened advanced economies from their strong position as investment destinations, thus making investors to focus on promising markets such as Africa, a fact supported by the fact that African cities were experiencing an influx of residents in search of work and better standards of living.
He added, “Africa’s growth presents investment opportunities in key sectors given the sheer size of the market and the continent’s potential. By 2030, more than 50 per cent of Africans will be living in cities.
“The key drivers in Africa’s real estate are political stability, macro-economic reforms, rapid urbanisation and a growing middle class.”
According to the Managing Director, Lekki Gardens, Mr. Richard Nyong, the opportunities inherent in the real estate sector are huge and real, with the biggest expense coming from families.
Nyong said there was a need to explore the opportunities in the sector and for stakeholders to have good fundamentals and capacity to do the business and know how to package products, fund and train people.
