How resilient is Nigeria's real estate sector?
With rising inflation impacting cost of construction in Nigeria, analysts are predicting a cautious optimism in the sector. Adeshola Bello, Managing Director of Landwey Investments, joins CNBC Africa to discuss how current economic challenges in impacting growth in the real estate sector.
Fri, 29 Sep 2023 12:09:37 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- The high cost of construction materials due to reliance on imported materials and foreign exchange fluctuations is a significant challenge in Nigeria's real estate sector.
- The real estate market is proving resilient despite economic challenges, with a shift towards a buyer's market where investors can capitalize on property appreciation to hedge against inflation.
- The sector's adaptability is reflected in evolving commercial trends, such as the shift towards smaller office spaces and increased demand for short-term rentals, as well as the growing focus on mixed-use developments and sustainability initiatives.
Nigeria's real estate sector is facing a period of economic challenges, with rising inflation and higher interest rates impacting the growth and development of the market. Adeshola Bello, the Managing Director of Landwey Investments, provided valuable insights into how the current economic landscape is influencing the real estate sector in a recent interview with CNBC Africa. Bello highlighted the high cost of construction materials as a significant challenge for developers, particularly due to the reliance on imported materials that are heavily impacted by foreign exchange fluctuations. This has led to a volatile market environment, with developers like Landwey grappling with inflationary pressures for the past year and a half. Despite these challenges, Bello emphasized the resilience of the real estate sector, noting a shift towards a buyer's market where savvy investors can capitalize on property appreciation to hedge against inflation. The sector's adaptability and capacity for innovation have enabled developers to weather the storm and explore new growth opportunities.
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