Money Market Indicators, Pension Funds, and Real Estate Finance in Nigeria

Macroeconomic indicators have been identified as having significant affect on a nation’s economy including the quantity of money available for real estate development; and arguably, pension funds have been identified as real estate finance option. Consequently, what are relationships between macroeconomic indicators and pension fund contributions? In resolving this question, secondary data were obtained from the websites of Central Bank of Nigeria and National Pension Commission covering 2006 to 2010. The Pearson’s product moment correlation analsis revealed the following variables pairing with pension fund contributions as having P-values < 0.05: AVNM and PFC (P-value = 0.0209; r2=0.93); CPS and PFC (0.0100; 0.96); BsM and PFC (0.0066; 0.97); CiC and PFC (0.0059; 0.97); BRs and PFC (0.0182; 0.94); CoB and PFC (0.0097; 0.96); DdD and PFC (0.0230; 0.93); QuM and PFC (0.0054; 0.97); AVBM and PFC (0.0095; 0.96). The study found that money supply in the economy (narrow and broad money), credit to private sector, base (or reserved) money, currency in circulation, bank reserves, currency outside bank, demand deposit, quasi money, all have high and positively correlated relationships amongst them. Similarly, trend analysis indicated continuous increase in pension fund contributions into the nearest future. It concluded that pension fund contributions would be a veritable source of financing real estate in Nigeria if properly harnessed

The Impact of Money Market Indicators on Real Estate Finance in Nigeria

Money supply in an economy is significantly affected by the money market indicators and, by implication, the funds available to the real estate sector. This study examines the relationship between money supply in the economy and some money market indicators with respect to their impacts on finance for real estate development in Nigeria. Secondary data were obtained from the Central Bank of Nigeria covering five-year study period (2006 to 2010). The Pearson product moment correlation and multivariate regression models were adopted for data analysis. The study found that there is statistically significant relationship between broad money supply (M2) and explanatory variables with P-values &lt; 0.05 except inter-bank call rate (0.7085), and prime lending rate (0.7554). Furthermore, the principal component analysis revealed that interbank call rate, inflation, and monetary policy rates are three components with eigenvalues &gt;1.0; they account for 77.01% of variability in M2. Also, stepwise regression of the variables showed that inflation, monetary policy rate, saving deposit rate, and Treasury bill rate have statistically significant impact on broad money supply in Nigeria. The implication is that money supply in the economy from where funds are made available for real estate development is significantly affected by the indicators and consequently the real estate sector by dwindling financial allocation to the real estate sector. It was recommended that real estate investment trust may possibly be the best option to financing the real estate sector of the Nigerian economy, while the Nigerian Institution of Estate Surveyors and Valuers has great role in birthing the investment vehicle. Key words: Real Estate, Monetary Policy, Money Supply, Inflation, Investment Trust, Finance, Property Development

AN EXAMINATION OF THE BASIS AND METHODS OF WETLAND VALUATION FOR COMPENSATION IN THE NIGER DELTA, NIGERIA

In assessing the worth of interest in any property, there are varieties of approaches available to the Estate Surveyor and Valuer. Howbeit, the approach chosen is usually a function of variety of factors such as the purpose of the valuation, the type of property, the basis of valuation. This study therefore examined the basis and methods adopted in the valuation of wetland resources in the Niger Delta. Questionnaire as well as personal and telephone interviews were adopted for data collection. Seventy-two (72) questionnaires were retrieved, collated, analysed and presented in the study using frequency distributions and percentages and relativeimportance index (RII). The study revealed that majority of Estate Surveyors and Valuers, in the Niger Delta adopted open market (61.8%) and cost (32.7%) bases for wetland valuation. Also, the study showed that in valuing wetland resources, respondents in the study area adopted methods that rely more on market evidence with market prices method ranked as having highest level of usage (RII = 3.15) followed by replacement cost method (RII = 3.03), cost-benefit analysis (RII = 2.96), hedonic pricing method (RII = 2.87) and production function (RII = 2.80). The study recommends that Estate Surveyors and Valuers should adopt total economic value basis for wetland valuation. Since contingent valuation method captures both the use and nonuse values of wetland resources it is recommended that Estate Surveyors and Valuers should adopt the method in valuing wetland resources for compensation. In addition, the Nigeria Valuation Standards and Guidance Notes should be reviewed with a view to including total economic value as a basis of wetland valuation and also include the identified methods for environmental valuation

AN EXAMINATION OF THE BASIS AND METHODS OF WETLAND VALUATION FOR COMPENSATION IN THE NIGER DELTA, NIGERIA

In assessing the worth of interest in any property, there are varieties of approaches available to the Estate Surveyor and Valuer. Howbeit, the approach chosen is usually a function of variety of factors such as the purpose of the valuation, the type of property, the basis of valuation. This study therefore examined the basis and methods adopted in the valuation of wetland resources in the Niger Delta. Questionnaire as well as personal and telephone interviews were adopted for data collection. Seventy-two (72) questionnaires were retrieved, collated, analysed and presented in the study using frequency distributions and percentages and relativeimportance index (RII). The study revealed that majority of Estate Surveyors and Valuers, in the Niger Delta adopted open market (61.8%) and cost (32.7%) bases for wetland valuation. Also, the study showed that in valuing wetland resources, respondents in the study area adopted methods that rely more on market evidence with market prices method ranked as having highest level of usage (RII = 3.15) followed by replacement cost method (RII = 3.03), cost-benefit analysis (RII = 2.96), hedonic pricing method (RII = 2.87) and production function (RII = 2.80). The study recommends that Estate Surveyors and Valuers should adopt total economic value basis for wetland valuation. Since contingent valuation method captures both the use and nonuse values of wetland resources it is recommended that Estate Surveyors and Valuers should adopt the method in valuing wetland resources for compensation. In addition, the Nigeria Valuation Standards and Guidance Notes should be reviewed with a view to including total economic value as a basis of wetland valuation and also include the identified methods for environmental valuation