RATHER than seeing them as fueling rising housing prices, experts are of the opinion that investments from the people in diaspora have formed major factors sustaining the Nigerian real estate sector, despite the present economic challenges.
According to them, the Nigerian real estate sector has been easily attracted to diaspora investors due to readily available funds to invest back home.
Professor of Estate Management Science from the University of Lagos, Gbenga Timothy Nubi and past president of the Nigerian Institute of Building, Mr Chucks Omeife, disclosed this while speaking with African Voice on Wednesday in Lagos.
Professor Nubi said that people in the diasporas did not fuel high housing price, but fund it challenging to invest their money back home.
“They are not in anyway responsible for high cost. If there’s anything, there’s drop, as the prices are increasing so the ability to actually invest back, and as the money is actually losing its value here, it is challenging for them to really put their investment here.
Let’s say you buy a property for N150 million, that’s about 100,000 pounds, and then you are expecting a return with the depreciated naira value, it is so very unattractive for them now because whatever you earn, by the time you convert it to Pounds Sterling for them to really feel like they are having return on that investment, you just find out that it is just nothing,” he said
The university lecturer pointed out that one thing going for the country was that an average Nigerian, especially an average diaspora loves the country so much.
According to him, whoever travels today has a mind of coming back, adding that the “home sweet home” is on the lip of every Nigerian that no matter how long, they see every other place as the farm but the home as a resting place.
“So you see Nigerians preparing for where they will come back to and that’s why young and old, they always invest, they want to have home here so that anytime they return there’s always a place for them to stay,” he said.
These days the professor of housing said that investment opportunity has made it possible that if one is not around, there won’t be any need to lock the house up, but let it out in exchange for money.
“That’s actually an incentive. Gone are the days that you have the house and only use it when you come for Christmas or any ceremony. Now if you have it, you can always lease it out, short-let and all the rest.
“So that actually explains why there are more people that are interested in having properties here,” Nubi said.
According to him, the cultural value, passion for neighbours, and the need to have something homeland constitute the driving forces that made the diaspora to be interested.
“I want to say, we have to appreciate them because I am in this sector and I know that for many years now, the economy and the construction industry have been fueled and sustained by this form of investment.
“The local economy has been struggling for many years, you find out that many people that have the purchasing power are the people from diaspora. There’s no way we can say that their contribution is insignificant. It is actually seriously significant instead of seeing them as people fueling price and all the rest,” he said.
According to him, Nigerians should see people in the diasporas as a sector that is complementary and sustaining real estate sector as they are bringing their money through remittance, while people are buying or building for them.
For Omeife, Nigerians are easily attracted to diaspora investors because they have readily available fund to invest.
Besides, he said that Nigerians were also exploiting the fact that people in diaspora are not conversant with prices of the building materials and could increase their profit margin in such transactions.
“The fact that they are not on ground to mount pressure gives the developers an advantage to work at his own pace. Some diasporians allow developers to manage the properties after completion which is an added income,” he said.
However, the former NIOB president noted that most properties prices across Nigeria are over-valued.
The reason, he said is based on the notion that “when something is expensive, it translates into original.”
He said, “The reason basically is because Nigerians have penchant that what is expensive is better, and this may not be necessarily so.”
The major reason for rising prices of housing units, Omeife said is hinged on the aftermath effect of the exchange rate between the local currency and the foreign currencies.
“Those in diaspora compare cost of housing development in their country of residence and that of Nigeria,” he said
According to him, the diasporians took advantage of the weakness of the local currency, brought in some foreign currencies and got so much naira that they could afford the seemingly high cost of properties.
“The other reason is that due to very bad experiences suffered in the hands of trusted relatives, friends and crooked contractors, they will rather buy off the shelf completed buildings and take possession.
“Those in diaspora will buy any property despite the cost if they can afford it and in a good location. It is this attitude and readiness to buy that has continued to push up the properties prices within the country,”Omeife noted.
Nubi said:” We have been to several part of the world, you will find out that they even have more information, they know about happenings in Nigeria more than those of us living in Nigeria 24/7, they have information, they have cross-checked from you, Oh! we heard this thing is happening in Ibadan, we beard this thing is happening in Abuja, is it true? And it will be like those of us living here don’t even know. What am I saying; Nigeria is a lucky nation that people are so passionate about their, they love the food, they love the culture, they love the weather, so Nigerians always carry Nigerians along with them anytime they travel and they can’t wait to come back.”
“So no matter how long you stay over there, according to our culture, we will always go back to be buried in our place and among our kindred and that’s not too far away from the scripture, from the bible where Joseph, Jacob, Abraham demanded that when they die, they should be gathered with their ancestors in their home. That’s exactly the pattern of an average Nigeria. I’m just saying this to prove that we love Nigeria, we want to live in this country. So you see Nigerians preparing for where they will come back to and that’s why young and old, they always invest, they want to have home here so that anytime they return, there’s always a place for them to stay,” Nubi said.
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