Following the economic recession in Nigeria, real estate developers are going through so much challenges in selling and renting properties, especially on the Lagos Island.
Most houses in the Lekki area of Lagos has been in the market for several months and no one is willing to buy even when the prices have been slashed down. This is quite unusual in a neighborhood where houses are paid for while under construction.
“We had a couple of properties which we had to crash down, which was like N4m, we had to reduce it down to N2.5m/N3m because of the economy,” Amaka Ezeilo, CEO Cowry Realty Development reports.
“In on-going constructions, we have houses that are going for N75m, we had to crash it down to N40m because of the economy and the banks are not giving out mortgages, they are not lending money to people.”
According to the report, there are lots of vacant buildings on Lekki, Ikoyi, Victoria Island and most buildings carry the ‘To Let’ Sign. The number of vacant houses has doubled over the last year and a rough estimate is about 70%.
The reason is because houses on the above-mentioned areas on the Island are the most expensive in Nigeria as they are sold in dollars. The current exchange rate of about N420 per dollar has made sales of these buildings even more difficult because people are not willing to spend such gigantic sum of money on properties.
Notwithstanding, more new buildings keep erupting every now and then, thereby making the competition higher for real estate developers and the commodity more than available for prospective buyers to choose from.