Friday , 28 March 2014
Headlines
- Lekki-Ikoyi toll illegal court says
- New Lagos Computer Village requires 20 Billion Naira
- EHINGBETI 2014: Powering the Lagos Economy: Real Opportunities, Endless Possibilities
- Nigerian Economic Summit to focus on Education
- Construction of 2nd Niger Bridge kicks off
- Fraud Alert: Beware of Ayobo land – Lagos Land Bureau
- NIESV becomes govt official property valuers and managers – BPP
Castles mid year review of property prices
Increase demand, Stable prices
The performance of the real estate market in the last six months (January – June) has not been impressive. In a midyear survey by Castle Lifestyle magazine based on adverts in the last six months, the prices and demands of residential properties from different areas in the state were accessed.
From the survey, it was discovered that the low performance of the Nigerian economy resulted in low demand for properties. In response to the low demand, prices remained stable in most areas of the state in the last six months.
The demand for properties was at its lowest at beginning of the year in all parts of the state, but gradually picked up towards the midyear but still not as expected by players in the market. From a review of adverts placed in Castle magazine from January to June, it was also discovered that the price of residential properties was stable with increase in very few locations.
Within the Ikeja GRA axis, even when demand for residential houses was generally low, Castle Lifestyle discovered that town houses were the most demanded in the area. A trend was noticed in affluent detached houses with potentials of further increase from its present average sale of N220 million. In an adverts placed in the magazine in January, a 4 bedroom semi detached house in Ikeja GRA was tagged for N95 million has gone as high as N110 million, an increase of 15.79 percent.
To most advertisers of residential properties on Castle magazine interviewed, in areas where there was little increase in demand, it was insignificant to affect the prices of residential properties. This is because demand for the residential properties did not outstrip supply within the last six months especially in the lowbrow areas. The affluent Nigerians prefer the highbrow areas while the low income earners did not get much involved in buying residential properties.
A close watch on Mowe- Ofada axis, one of the border town between Lagos and Ogun State, and fast growing with residential activities, shows that the price remained unchanged even when there is an increase in the demand for residential properties. The price of the 2 and 3 bed room residential properties advertised by Kayode Obembe & Co ( 019585654) in January has remained the same in the month of June. The price range of the 2 bed room building within the Mowe-Ofada axis still stand between N4 – 5 million in June as it was in January. Also the price of a 3 bedroom building advertised by the company in January still ranges between N6 – 7 million. According to Obembe, even with the stable price of residential properties within the Mowe-Ofada axis, there are great possibilities that the area would boom in the nearest future. For now, there seems to be a wrong impression on the area because of the near absence of infrastructure such as roads and other communication links but with a little expected attention from government, Mowe-Ofada axis would be the destination choice for residents.
One of the areas that business boomed and is still booming in the last six months is the 1004 estate. Castle Lifestyle investigation shows that there was increase in demand which resulted in increase in the price of residential properties in 1004 estate. Admacons Properties ( noticed a 20 – 25 percent increase in the price of properties in the axis in the last six months. The need to reside close to the place of work within the Island was the main reason for the increase. From adverts placed in Castle Lifestyle, 2 bedrooms maisonettes were tagged for N50 million/N52 million/N55 million, as at June, same properties were tagged for N50 million/N62 million/N65 million.
From the Lekki axis, there has been an appreciable increase in demand and sales but slight upward movement in price. In this location, the supply of houses and lands are running out fast and naturally price will tend to move up. In the last six months, detached houses moved from N80 million to between N85 – N90 million between January and June.
In our findings from Fine & Country (, ) there has been an increase in the demand for properties in Lekki axis. In the six months, white collar professionals, bankers and business people appreciate the proximity of Lekki to Victoria Island where most corporate offices are located.
In the Magodo phase 2 Shangisha, detached houses rose from N55 million as at January to N65 million at the end of June. For Magodo Isheri, price of detached houses increased from about N60 – N65 million in January to about N70 million at the end of June. Semi-detached houses in the area increased from about N50million at the beginning of the year to N55 million at the midyear.
On the Mainland, most of the parts investigated by Castle Magazine shows a decrease in demand for residential properties which is easily noticed in the low brow areas. Blessojer Nigeria Limited ( advertised a 5 bedroom detached mansion with boy’s quarter, 2 mini flat, security house, and all rooms en-suite with carport, bathtub, Jacuzzi and very spacious, in Omole Phase 1. In January, the price of similar residential property in the same place remained unchanged six months later.
According to Megamound Homes (, ) demand for residential properties has been low from January to June. Based on adverts of residential properties by Megamound Homes on Castle magazine, the prices of residential properties remained unchanged. In January, prices of properties in Lekki Country Homes advertised by Megamound Homes remained stable in the last six months. Megamound Homes in January advertised a 4 bedroom detached house plus a boy’s quarter for N70 million, in June edition of the magazine, similar residential property was still advertised for same price. Megamound Homes also advertised a 4 bedroom detached house on 600 square meters for N64 million in January, the price of similar items was still the same the midyear according to the June edition of Castle magazine.
In Ikoyi, the demand for residential properties was low in January but picked up as the year progressed. Castles magazine discovered that only new buyers of houses within the Ikoyi are politicians and illegal oil dealers. It is also discovered that people are doing more renting within the Ikoyi area than buying of residential properties. The price of residential properties within the area has also remained unchanged within the period despite the low demand. Ariwayo Group Nigeria Limited ( ) recently placed an advert for a newly built 3 bedroom maisonette for N120 million in the June edition of the magazine, the price was the same as at January this year. Also, the price of a 3 bedroom flat placed for N100 million had the same price tag as at January this year.
From the findings by Castle magazine, the decrease in the demand for residential properties is as a result of the low purchasing power in the country. Also from the findings, security, safety, closeness to place of work, infrastructure played a huge role in the demand and supply of residential properties in the last six months. However, most properties developers are expecting the market to pick up from the month of September. At that period, most Nigerians would have known what their financial position would be at the end of the year and would be ready to get a home for shelter.
By Pita Ochai
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