Housing construction costs and house rents fluctuations in an emerging property market: the case of Osogbo, Nigeria

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Augustina Chiwuzie ◽  
Daniel Ibrahim Dabara
Keyword(s):  
Positive Relationship ◽  
Rental Housing ◽  
Construction Cost ◽  
The Body ◽  
Housing Construction ◽  
Property Market ◽  
Construction Costs ◽  
Content Type ◽  
Macroeconomic Variables ◽  
Property Owners

PurposeCost of construction of residential properties as well as its subsequent rent trends remain a major challenge to stakeholders in the property rental markets of emerging economies. This study examined the relationship between housing construction costs and house rents fluctuations in Osogbo, Nigeria, to provide information for informed investment decisions.Design/methodology/approachThe authors conducted a survey, where three sets of questionnaires were administered on building contractors; estate surveyors and valuers and private residential property owners. The data required comprise the estimated average construction costs and average market rents for two and three-bedroom bungalows in the study area from 2008 to 2018. These data were respectively sourced from all the 15 firms of building contractors and 25 firms of estate surveyors and valuers in Osogbo, Nigeria. Stratified random sampling was employed to select 180 property owners from three medium-density residential districts of Osogbo. Secondary data on macroeconomic variables were sourced from the Central Bank of Nigeria. Data collected were analysed using descriptive and inferential statistical tools.FindingsThe authors found a significant positive relationship (0.749) between construction costs and house rents trends; both variables maintained ascending trends. Construction costs and house rents inflation rates exhibited random fluctuations with the former having a higher mean inflation rate (10.47%). However, the difference was not statistically significant (p-value = 0.317 > 0.05). Respondents identified consumer price index (CPI) inflation among other macroeconomic variables as the strongest predictor of both construction costs and house rents fluctuations. However, evidence from further analysis of the time series suggested otherwise.Practical implicationsThe result confirms construction cost as one of the vital supply factors of the housing market, which is often pass through to house rents. The positive relationship between construction costs and house rents trends should trigger new development which, will, in turn, allow rental housing investments to expand into new areas with prospects for profits that could be earned by domestic and foreign investors.Originality/valueThis study to the best knowledge of the researchers is the first to relate housing construction cost to house rent in Osogbo, Nigeria; thereby adding to the body of knowledge in this field.

Rethinking the tenant eviction process in Harare, Zimbabwe

2018 ◽  
Vol 36 (3) ◽  
pp. 252-277
Author(s):  
Tazviona Richman Gambe
Keyword(s):  
Qualitative Methodology ◽  
Rental Housing ◽  
Property Management ◽  
Property Market ◽  
Real Property ◽  
Content Type ◽  
The Real ◽  
Property Owners ◽  
Depth Interviews ◽  
Practical Implications

Purpose The purpose of this paper is to explore the lessee eviction process in Zimbabwe in order to suggest possible ways of improving this process that has become a rutted road characterised by a litany of hiccups. Design/methodology/approach The study is guided by the qualitative methodology. Data were mainly collected from property managers operating in the real property market in Harare using in-depth interviews. Analysis of data was done through content analysis. Findings It emerged from the study that the eviction process in Zimbabwe is fraught with impediments and expenses that are sometimes exasperating to property owners and investors. The current eviction regulations favour the lessees at the expense of lessors thus niggling lessees have aggravated the already protracted process by unnecessary appeals. Research limitations/implications The paper only focuses on residential property management and eviction of legal lessees due to non-payment of rentals. Practical implications The rent regulations should be reviewed in order to create a fair legal system that protects the rights of both the lessors and lessees in Zimbabwe. Originality/value The perpetual decline of the economy in Zimbabwe has crippled lessees’ ability to pay rentals. Yet, it has also become intricate to evict defaulting lessees thereby causing loss of income to rental housing investors. Thus, the paper challenges the protracted eviction processes in the real property industry that have prejudiced property owners and scared away potential rental housing investors that are greatly needed to boost the rental market.

Shared values and organizational effectiveness: a study of the Nigerian banking industry

2014 ◽  
Vol 33 (7) ◽  
pp. 694-708 ◽  
Author(s):  
Edwinah Amah ◽  
Augustine Ahiauzu
Keyword(s):  
Organizational Effectiveness ◽  
Market Share ◽  
Positive Relationship ◽  
Banking Industry ◽  
Employee Involvement ◽  
Relevant Literature ◽  
Shared Values ◽  
The Body ◽  
Content Type ◽  
Significant Positive Relationship

Purpose – The purpose of this paper is to examine the extent to which shared values influences organizational effectiveness and the extent to which shared values influences profitability, productivity, and market share. Design/methodology/approach – The correlational study adopted a cross-sectional survey design. Research questionnaires were administered; interviews were held with managers in the organizations studied. A total of 388 managers were randomly drawn from a population of 13,339 managers of all the 24 banks in Nigeria. The independent variable, “shared values” was measured by coordination and integration, agreement, and core values. The dependent variable, organizational effectiveness was measured by profitability, productivity, and market share. The measures used a five-point Likert scale ranging from 1-strongly disagree to 5-strongly agree. Spearman's rank correlation statistical tool was used to test the hypotheses. Findings – The result (ρ=0.555, p<0.05) (see Table II) shows a significant positive relationship between shared values and profitability. The result (ρ=0.504, p<0.05) (see Table III) shows a significant positive relationship between employee involvement and productivity. The result (ρ=0.359, p<0.05) (see Table IV) shows a positive relationship between employee involvement and market share. There is a significant positive relationship between shared values and organizational effectiveness. Research limitations/implications – The results cannot be generalized because the study was carried out only in the banking industry. Not all the questionnaires given out were retrieved. Some respondents were reluctant to give out information about their organizations because of fear that such information will get to their competitors. Relevant literature on the topic of African origin were scarce, thus most of the literature reviewed was from Europe and America. Practical implications – The results imply that increase in the level of shared values in organizations will enhance profitability, productivity, and market share. This means that “shared values” is associated with organizational effectiveness. Originality/value – The study provides increased understanding, prediction, and appreciation of human behaviour. It enables us analyse the relationship that exist between shared values and organizational effectiveness. The study significantly enhances the body of knowledge in this area of management as it provides reliable empirical results that can be used by scholars and practitioners. It will also help to alert managers on the implications of cultivating a culture of sharing values in the organization that can serve as a competitive advantage. The study will be a challenge to further research because of its findings.

An analysis of operating expense control within US multifamily properties

2017 ◽  
Vol 35 (1) ◽  
pp. 48-66 ◽  
Author(s):  
Andrew Carswell
Keyword(s):  
Explanatory Variable ◽  
Rental Housing ◽  
Positive Association ◽  
Individual Investors ◽  
Property Management ◽  
Property Market ◽  
Data Set ◽  
Content Type ◽  
Operating Income ◽  
The Usa

Purpose The purpose of this paper is to determine the effect that ownership and management structures have on ability to control operating expenses. For individual investors, intensity of management experience is also explored as a possible explanatory variable for operating expenses. For property management services that are contracted out, the level of the fee is investigated as a possible cause for movements in operating expenses as well. Finally, operating expenses are used as a possible explanatory variable for a property’s lease-up performance during the year. Design/methodology/approach The analysis consists of a series of regression models performed on data provided by the 2012 Rental Housing Finance Survey (RHFS) in the USA. The RHFS is a unique data set that covers a wide degree of information on multifamily properties. The RHFS represents 2,260 properties in total, and covers various aspects of the apartment industry, including financing and operational cost measures. Control variables used as independent variables include number of units, year of property acquisition, and age of building. Findings Individual ownership and self-management proved to be statistically significant drivers in driving down log operating expenses. Hours spent by individuals performing property management roles on their own properties had a slightly positive association with operating expenses. For professional managers, the fees devoted solely to the manager or management company had a highly significant and positive effect on other operating costs. Finally, when separating out the individual components of operating expenses, only two variables had significant effects on tenant lease-ups: management expenses (positive) and security expenses (negative). Research limitations/implications The data set is potentially biased toward those properties with less than 100 units, and thus it would be problematic to assume that these findings are generalizable to the population at large. There are also no geographic coding indicators within the RHFS data set, which eliminates the potential to control for various market factors and rural/urban differences. Practical implications The research provides an understanding of some of the basic factors behind increases in operating expenses, which ultimately has implications for performance benchmarks such as net operating income and property market value. Social implications The reasonable controlling of operating expenses ultimately has potentially positive implications for low- to moderate-income populations, who would ultimately experience lower rents as a result. Originality/value This research represents one of the first known uses of the RHFS database.

scholarly journals H2020 – RentalCal – European rental housing framework for the profitability calculation of energy efficiency retrofitting investments

2018 ◽  
Vol 36 (1) ◽  
pp. 125-131
Author(s):  
Joseph-Alexander Zeitler
Keyword(s):  
Decision Making ◽  
Energy Efficiency ◽  
Best Practice ◽  
Rental Housing ◽  
Decision Making Process ◽  
Content Type ◽  
Property Owners ◽  
Investment Barriers ◽  
Sound Foundation ◽  
Areas Of Interest

Purpose Most of the European apartment blocks are rental units of which the majority needs major refurbishments in upcoming years to achieve climate goals. On the other hand, it is still difficult for property owners to evaluate the profitability of energetic retrofitting investments. The purpose of this paper is to contribute to the situation by forming a standardized framework and tool to calculate profitability of energy efficiency investments throughout Europe. Design/methodology/approach From a European perspective, several different areas of interest (technical, legal, institutional and financial) have been screened to develop an extensive compendium. This has been performed by literature research and several national surveys. Based on these findings, an online-based tool for profitability calculation has been developed to support the decision-making process of each individual, regardless his knowledge on energy efficiency. Findings This paper provides a short overview on main investment barriers in Germany. It is found that both market conditions and information deficits harm energy efficiency investments. Frequently, the decision-making process is found difficult due to inflexible regulations and lack of knowledge. This dramatically reduces market incentives that are already in place. Most often, the investor user dilemma is seen as the main investment obstacle. In this context, transparency and reliability are found to trigger energy-efficient investments. Practical implications Findings are used to identify best practice examples and to assess their transferability to other markets and countries. Innovative solutions have been extracted to improve the overall investment climate. Originality/value The paper contributes to a sound foundation for energy-related investments and the fulfillment of EU reduction targets.

scholarly journals The securitization of residential rental revenue streams in Europe

2017 ◽  
Vol 10 (4) ◽  
pp. 503-518 ◽  
Author(s):  
Jaume Roig Hernando
Keyword(s):  
Real Estate ◽  
Housing Market ◽  
Risk Sharing ◽  
Rental Housing ◽  
Cash Flows ◽  
Property Market ◽  
Investment Funds ◽  
Content Type ◽  
The Usa ◽  
Residential Market

Purpose The purpose of this paper is to analyze the securitization of rental streams, a new investment and finance product introduced in the USA in 2013 that enables fundraising from large residential portfolios owned by major investment funds and investment banking. The securities are made up of non-performance loans as well as real estate portfolios of financial entities. Design/methodology/approach An academic analysis of the European securitization market is performed, as well as a broad overview of the state of the art of the rental housing market and investment property market. Moreover, a market study of Real Estate Owned (hereinafter, REOs) and Real Estate Debts is carried out to determine both the present framework and future trends. Various financial entities and real estate management companies are examined through interviews and data collection to assess the reality of distressed assets and residential portfolios owned by major investors. It introduced the Broker’s Price Opinion concept, de loan-to-value concept and the London Interbank Offered Rate. Findings REO-to-rental securitization is a step forward toward the democratization of finance through the globalization of the residential market, improving risk sharing for major and retail investors. The securitization of rental streams in Europe has not taken off, despite several issuances in the USA since 2013 with significant success where first tranches obtained a credit qualification of triple-A from the majority of the main rating agencies. Originality/value At the end of 2013, a global investment firm launched an innovative finance and investment vehicle that securitized the cash flows originating from leased residential properties. That issue resulted in considerable success and in the development of a new alternative and innovative financing source for real estate activity. Taking into account that housing is a primary need of our society, there is a strong motivation for improving the residential market, and thus, REO-to-rental securitization could help take a step forward in making the housing market more efficient.

Cost-risk contingency framework for managing cost overrun in metropolitan projects: using fuzzy-AHP and simulation

2020 ◽  
Vol 13 (5) ◽  
pp. 1121-1139 ◽  
Author(s):  
Farman Afzal ◽  
Shao Yunfei ◽  
Danish Junaid ◽  
Muhammad Shehzad Hanif
Keyword(s):  
Risk Factors ◽  
Risk Analysis ◽  
Construction Cost ◽  
The Body ◽  
Cost Overrun ◽  
Content Type ◽  
High Uncertainty ◽  
Total Construction Cost ◽  
Cost Risk ◽  
Contingency Framework

PurposeRisk analysis plays a vital role in controlling and managing cost overruns in complex construction projects, particularly where uncertainty is high. This study attempts to address an important issue of cost overrun that encountered by metropolitan rapid transit projects in relation to the significance of risk involved under high uncertainty.Design/methodology/approachIn order to solve cost overrun problems in metropolitan transit projects and facilitate the decision-makers for effective future budgeting, a cost-risk contingency framework has been designed using fuzzy logic, analytical hierarchy process and Monte Carlo simulation.FindingsInitially, a hierarchical breakdown structure of important complexity-driven risk factors has been conceptualized herein using relative importance index. Later, a proposed cost-risk contingency framework has investigated the expected total construction cost in order to consider the additional budgeted cost required to mitigate the risk consequences for particular project activity. The results of cost-risk analysis imply that poor design issues, an increase in material prices and delays in relocating facilities show higher dependency and increase the risk of cost overrun in metropolitan transit projects.Practical implicationsThe findings and implication for project managers could possibly be achieved by assuming the proposed cost-risk contingency framework under high uncertainty of cost found in this research. Furthermore, this procedure may be used by experts from other engineering domains by replacing and considering the complex relationship between complexity-risk factors.Originality/valueThis study contributes to the body of knowledge by providing a practical contingency model to identify and evaluate the additional risk cost required to compute total construction cost for getting stability in future budgeting.

scholarly journals The Determinants of Dividend Payout: Evidence from the Malaysian Property Market

2018 ◽  
Vol 11 (1) ◽  
pp. 27
Author(s):  
Ong Chun Lin ◽  
Hassanudin Mohd Thas Thaker ◽  
Ahmad Khaliq ◽  
Mohamed Asmy Mohd Thas Thaker
Keyword(s):  
Ownership Structure ◽  
Positive Relationship ◽  
Annual Report ◽  
Negative Relationship ◽  
Property Market ◽  
Dividend Payout ◽  
Return On Equity ◽  
Macroeconomic Variables ◽  
Significant Negative Relationship ◽  
Property Companies

The paper aims to investigate the determinants of dividend payout among the Malaysian property companies. The sample size consists of 30 property listed companies on Bursa Malaysia. The data are generally obtained from the company’s annual report for the period of 2012 to 2016. The study employs multiple regression analysis to examine the influence of firms specific and macroeconomic variables on dividend payout. Result of the test shows that the dividend payout has a significant negative relationship with ownership structure and positive relationship on return on equity, quick ratio and GDP. The study instigates to enrich the literature on dividend determinants especially in the context of Malaysia.

Economic impediments to successful seismic retrofitting decisions

2014 ◽  
Vol 32 (5) ◽  
pp. 449-466 ◽  
Author(s):  
Temitope Egbelakin ◽  
Suzanne Wilkinson ◽  
Jason Ingham
Keyword(s):  
Financial Incentives ◽  
Local Governments ◽  
Risk Mitigation ◽  
Seismic Retrofitting ◽  
Mitigation Measures ◽  
Earthquake Risk ◽  
Property Market ◽  
Content Type ◽  
Property Owners ◽  
Earthquake Risk Mitigation

Purpose – The purpose of this paper is to examine why building owners are often reluctant to adopt adequate mitigation measures despite the vulnerability of their buildings to earthquake disasters, by exploring the economic-related barriers to earthquake mitigation decisions. Design/methodology/approach – A case study research method was adopted and interviews chosen as the method of data collection. Findings – Critical economic-related impediments that inhibited seismic retrofitting of earthquake-prone buildings were revealed in this study. Economic-related barriers identified include perception about financial involvement in retrofitting, property market conditions, high insurance premiums and deductibles, and the high cost of retrofitting. The availability of financial incentives such as low interest loans, tax deductibles, the implementation of a risk-based insurance premium scale and promoting increased knowledge and awareness of seismic risks and mitigation measures in the property market place are likely to address the economic-related challenges faced by property owners when undertaking seismic retrofitting projects. The provision of financial incentives specifically for seismic retrofitting should be introduced in policy-implementation programme tailored to local governments’ level of risks exposure and available resources. Practical implications – The recommendations provided in this study suggest strategies and answers to questions aimed at understanding the types of incentives that city councils and environmental hazard managers should focus on in their attempt to ensure that property owners actively participate in earthquake risk mitigation. Originality/value – This paper adopts a holistic perspective for investigating earthquake risk mitigation by examining the opinions of the different stakeholders involved in seismic retrofit decisions.

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