CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
Real estate has continued to play a significant role in man’s evolution. It is not aco incidence that food, shelter and clothing believed to be the three
essentialsthat sustain mankind, also have some linkage to land. Food grows out of landwhile shelter is aixed
to it, and man’s clothing is made largely from
what growsout of land. Indeed, whether in ancient times or today’s modern system, landconstitutes a significant index for man’s wealth, and as economic
activities haveassumed more sophistication over time, land has continued to play a central rolein their development (Lewis , 1994). There is hardly any
business venture that does not require to be supported by some form of real estate: from the small business that requires real estate as voices from where its
business can be organized, to themajor venture that needs it for its factory.
Consequently, through some very robust and well thought out land policiescomprehensively address challenges that are encounter in the real estate
sector.This is not exactly the situation here in Nigeria and the result is that there is amyriad of problems in the real estate sector (Adewale, 2000). In the course
of this study, the researcher will provide an overview of real estate investments in Nigeria and its associated challenges.
Real estate investment is intrinsically connected to the economicdevelopment and well being of any nation, thereby necessitating someintervention by
prudent governments. Such interventions vary in degrees,depending on the nation. In Nigeria, individual could rarely lay claim to any part of it asowner and
therefore could not alienate it without the consent of the head.
Proper financing is all-important to successfulproperty/real estate investment and development. Variousforms of finance on varying terms from
diverseinvesting agencies are available to the property/real estate market. The principal field where various formsof investment finance are employed is that
of development where every loan has to be specially tailored for an individual scheme and the particular stages within the scheme.Since real estate and property development in particular involves huge capital expenditure, finance is therefore an essential input, the nature of which is to provide capital to enable the enterprise operate commercially (Ratcli, 1999). The cost and availability of finance for real estate development can influence the viability of such project. It is necessary to examine the nature of real estate investment in Nigeria with a view of finding solutions to the associated challenges.
1.2 STATEMENT OF THE PROBLEM
In recent times, research on real estate investment has been on the front burner has it is the major source of housing for man. In the hierarchy of man’s needs,
housing has been ranked second and as a result of this; housing provision has become a paramount cornerstone oh policies of various governments both
at federal and state levels since independence in Nigeria. The consequences of the rapid rate of urbanization are most visible in the rapid deterioration of urban
housing resulting in urbanhousing poverty especially as there is noproportionate increase in the number of housingstocks.
During the period of economic boom in the 1970s in Nigeria, there was surplus capital, the economic climate then was favorable for the development of real
estate and the prospect ofgain was over blown and so were the rate ofdevelopment. Due to the recent drop in the prices of crude oil world wide and
corruption, government has not been able to invest in real estate. Overpopulation and urbanization has led to massive increase in property development.
Financial houses readily obliged developers’ loans, as they perceived minimum risks
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