Presently, Nigeria is experiencing the worst foreign exchange crisis in its history as a result of the ever-increasing demand for FX despite the low supply. The Central Bank of Nigeria put a halt to the bi-week sale of FX to Foreign Portfolio Investors, to resolve the outstanding backlog of contractual obligations for the supply of FX to FPIs via the banks which was not met. According to the CBN data, the country’s foreign reserve witnessed a 2.9 percent decline.
In an interview, Anand Kumar, the Head of Business of PPC Limited, spoke about how green buildings drive the demand for an eco-friendly environment, as well as other challenges affecting real estate. On the implications of residential and commercial buildings accounting for about 40 percent of the global energy-related carbon emission, he noted that this could be analyzed in perspectives. He explained that the demand has been immensely driven by the huge migration. The occurrence of developments impacted in cities and the difficulty in finding amenities in small towns, people become attracted to these cities and hence, migrate. Kumar pointed out that this factor immensely impacts on housing.
Small towns must be developed to ease cities off migration increase.
Kumar further asserted that with the huge population and increasing unemployment evident within these cities and as such, implored that basic amenities be installed, as well as welfare support to be granted to every residents within these cities. He also noted that these small towns must be developed to further ease the cities off a consistent surge in migration. He insisted that housing was a major challenge in Nigeria due to residential staking up the first part of most cities. On the climate impact, he stated that it was a bad sign due to the increase in carbon emission which would further cause pollution. On the positive perspective, he explained that this would increase employment for the huge population influx.
On the capability of the real estate sector in underwriting imminent risks, Kumar pointed that it was the role of the federal and state government to enhance the sector, especially in scaling the mass housing scheme to a larger proportion. He said that the government could attend to some of the projects’ funding requirements, whilst collaborating with real estate stakeholders to minimize risks. He added that the government policy must give priority to investments for manufacturing local building implements instead of importing. He then insisted that the government must further support the real estate industry to enable developments within the sector.
Currency fluctuations affecting the real estate industry.
The PPC Limited’s Head of Business again explained that the transformation of most urban communities into mega cities were an evident indication of the technological development. He noted that with technology, Lagos State for instance can use the recycling strategy to maximize its available water and energy in making these resources more effective. On how the present forex scarcity was impacting the real estate sector, Kumar explained that over 80 percent of their service requirements were being imported and as such, the currency fluctuation was impacting the sector.
He again explained the relevance of green building in salvaging the housing deficit that has ravaged Nigeria. The Green building was immensely important across the globe in ensuring the approval of buildings and constructed to the standards of green buildings, which are basically the minimal usage of water, electricity and other billing services. Kumar pointed out that Nigeria presently had no requirement for basic building needs, power deficit and as such, must follow the recognized green standard.
Housing, one of Nigeria’s major challenges, must experience improvement.
When asked about affordable houses for low income earners, Kumar stated that housing, which was one of the country’s biggest challenge, must experience immense improvement. He noted that a majority of the population were not in good condition, as a result of the unavailability of accommodations. He however stated that the building cost must be simmered down. He also indicated that green building would help people in buying and leasing into the advanced building standards.
Related Link
Green Building Council Nigeria: Website
Forex scarcity stalling real estate sector. – Green building driving the demands for an eco-friendly environment. – Express your point of view.
The real estate will have to adopt the cash policy system too. Forex scarcity might have reduced their business, they don’t have choice than to adapt to the current situation.
While working with real estate stakeholders to reduce risks, the government might handle some of the projects’ finance needs.
Housing, which was one of the largest problems in the nation, needs to be greatly improved. To make it cheap for those with limited resources
The Central Bank of Nigeria put a halt to the bi-week sale of FX to Foreign Portfolio Investors
As a result of the ever-increasing demand for foreign cash despite the inadequate availability, Nigeria is currently going through the biggest foreign exchange crisis it has ever gone through in its entire history.
The recent developments have impacted several sectors in the country. Am sure this is just for the time being. Real estate sector will eventually thrive well.
In addition to this, Kumar argued that due to the large populations and steadily rising unemployment rates that are present in these cities.
People are drawn to the larger cities as a result of the occurrence of developments that have an impact on cities and the fact that it is difficult to find amenities in smaller towns.
Forex scarcity stalling real estate sector. We need to do something because the way this country Nigeria is moving is not too bad. Every sector has gone down.
Nigeria is experiencing its worst ever foreign currency crisis as a direct result of the country’s ever-increasing need for foreign cash and the country’s inadequate supply of such cash.
To facilitate additional growth within the real estate sector, the government should increase its level of support for the industry.
In addition to the difficulty of locating basic services in smaller communities, the emergence of developments that have an impact on cities also attracts people to the larger urban centers.
Once more, the Head of Business at PPC Limited noted that the transformation of the majority of metropolitan towns into mega cities was an obvious evidence of the progression of technology.
The policy of the government ought to place a higher premium on investments made in the domestic manufacturing of building tools rather than on imports.
There will be a complete shift to a cash-only system throughout the real estate industry. Though the lack of readily available foreign exchange may have hurt their business, they must now adjust to the new normal.
Real estate sector need ti improve and adapt to the situation going on in the country because the country is going through too much struggle and suffering
For a successful enhancement of the sector discussed, the govt must collaborate with real estate stakeholders to minimize risks, the govt policy must give priority to investments for manufacturing, the govt must further support the real estate industry to enable developments within the sector.
The issue of Forex for big businesses owners has been the problem since 8 years ago and this has made business very difficult and also cause inflation.
The currency fluctuation in inflation is really having a negative impact on the real estate sector. And has such is Forex scarcity stalling real estate sector
In view of the recent happenings in the country: the CBN cashless policy, inflation and scarcity of Forex are having major impact on Real Estate. The Real Estate sector needs to be flexible with the economy to be able to maximize profits.