FEATURED PAPER
By Chukwuma I. Elizabeth
Department of Estate Management
Delta State University of Science and Technology
Ozoro, Delta State, Nigeria
ABSTRACT
The real estate market, also known as the property market, can be described as a set of submarkets where trading of property rights ranging from the purchase, development, ownership, management, rental, to sale of real estate and related properties investment for profit exist. Nigerian real estate sector has been greatly influenced by laws, policies as well as institutions in which it is meant to thrive overtime. Furthermore, these laws and policies have critical impacts on the future sector of real estate, recipient of public investment.
Currently, a growing number of real estate investments are hampered by some of these government policies characterized by cumbersome regulations, ownership restrictions, and unpredictable changes in legislation. The study analysed the various government policies in real estate with a view to determining the impacts on property market. A structured questionnaire was used to obtain information from respondents in public and private organisations. The obtained information was examined using Weighted Mean Score, Logistic Regression and Factor Analysis. Factor Analsyis is used in data reduction to identify a large number of factors that explain most of the variance observed. The findings of this research shows that some of principal factors influencing performance of government policies on both the public and private perspective were: insufficient infrastructural amenities, shortage of skilled manpower, bureaucracies in land, ineffective project inspection and ineffective government programme and policies, poor distribution and allocation and ineffective project inspection. Therefore, this study recommends need for establishment of policy/guidelines and supervision of its use for environmental sustainability.
Keywords: Impacts, Government Policies, Real Estate Sector, Akure
INTRODUCTION
The real estate market is a place where transactions related to property rights, lands, properties are traded [1]. It also extends to all property categories of single and multifamily residential homes, mercantile and agricultural lands, water houses, office spaces, shopping complexes, malls as well as wholesale and retail outlets among others. According to [2], government policies are a set of principles, rules, guidelines, and actions put in place by a government to address specific issues, achieve particular goals, or regulate various aspects of society. [3] indicated that land use and zoning regulations, property registration and title systems, taxation policies, housing policies and rent control, foreign investment policies, real estate regulatory bodies are some of the common types of policies that regulate and influence the real estate sector. These policies are designed not only for market transparency and trust but also guide decision-makers on matters relating to the lives of citizens, businesses, and the overall functioning of a country.
Over the years, the Nigerian economy has undergone various level of restructuring to ensure functionality, better governance, economic strength while enabling harnessing better opportunities of the real estate sector. However, its many challenges characterized by inconsistencies, lack of transparency, and a high level of bureaucracy impedes the growth and development of the sector [4]. These challenges hamper the sector’s ability to provide affordable housing, contribute to issues such as land tenure disputes, fraud, difficulty in obtaining property titles, and a general lack of investor confidence. Study by [5] reveals that the key economic government policies such as housing policy, fiscal policy, taxation that are relevant to the real estate sector are hampered by issues of property titling, bureaucracy and corruption.
A number of studies have posited different arguments for and against the facets of interventions in the real estate market. [6], determined the effects of taxation policy in property market through the imposition of property tax on sustainable housing delivery. The study employed regression analysis to model how various tax variables (such as property taxes, capital gains taxes, or stamp duties) impact real estate prices, demand, or investment. This method allows for the identification of statistically significant relationships. It was found that government intervention through the imposition of statutory formula for determining the amount payable by property owners as land use charge was inappropriate and that high tax and penalties would discourage investment in new housing and maintenance of existing stock.
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How to cite this paper: Elizabeth, C. I. (2024). Impacts of Government Policies on Real Estate Sector in Akure; PM World Journal, Vol. XIII, Issue VII, July. Available online at https://pmworldlibrary.net/wp-content/uploads/2024/07/pmwj143-Jul2024-Elizabeth-impacts-of-government-policies-on-real-estate-sector-in-Akure.pdf
About the Author
Chukwuma I. Elizabeth
Ozoro, Delta State, Nigeria
Chukwuma Isioma Elizabeth is an Assistant Lecturer at Delta State University of Science and Technology, Ozoro, Delta State. She received both bachelor’s and master’s degree in Estate Management from Federal University of Technology, Akure. Her current field interests include land administration, land economics and property values. She can be contacted at isiomaelizabeth01@gmail.com
