Real Estate Investment Market in Africa: The case of Ghana

Anim-Odame, Wilfred

doi:10.15396/afres2013_107

Cited by 4 publications

(9 citation statements)

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“…Across property sub-markets, the differences in long-run rewards have been in large part driven by variation in rates of rental value growth. Anim-Odame et al’s (2010) work, although was on property sub-markets of the federal capital city of Ghana, on the gross rental income range but not on net rental income specifically. Asides, it has been outdated.…”

Section: Literature Reviewmentioning

confidence: 99%

Review of the methodological approach of analysing rental income of residential property in Abuja, Nigeria

Bello

Abdullahi

Atilola

et al. 2022

JFMPC

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Purpose This study aims to review the approaches used in the analysis of rental income of residential property in Abuja, Nigeria, to strengthen the existing investment performance approaches initially relied upon by property investors towards having a better and reliable performance evaluation for property investment decision-making. Design/methodology/approach With the adoption of combined methodological approaches, quantitative data on rental history (2006–2016) were collected on the randomly selected residential investment properties (block of flats) available in the portfolio of estate surveying firms in the different locations/sub-markets of the study area. Data collected were analysed with the frequency mean and growth rate. Findings All the methodological approaches adopted for analysis displayed varying performance results. No particular sub-market maintains the same ranking position in any of the approaches. The developmental phases previously used as an indication of yield in the study area do not correspond with the status of rental income of sub-markets. Yield has been observed to be a mere attraction to property investment; it does not translate to income growth. Mean income (though a good indicator of changes in rental income) is not a reliable indicator of growth in income, and growth in the rate of income omitted the changes in rental income during the holding period. Research limitations/implications The study was restricted to historical rental income data on a block of flat-type residential property, and it does not include capital value analysis or inquire into the factors responsible for variation in rental income during the study period. The outcome of this study is only applicable to a block of 4 number three-bedroom flats residential property type. Practical implications Multiple simple methods of analysing rental income performance should be preferred to the single complex method. This will simplify investors’ rental income characteristics of investment towards a better understanding of rental property investment analysis. That rental value appreciates with time does not translate to an increase in the actual rental income of residential investment property. Social implications Through these performance approaches, ranking of the sampled properties in the study area sub-markets will enhance investors’ traditional diversification planning across the study area for an enhanced combination that can achieve latent profitability. The attention of investors is hereby called to these multiple approaches to enable them to merge their investment objectives with any or a combination of these approaches towards making rational investment decisions. Originality/value This seems to be the first advocacy for methodological paradigm shift applicable to direct residential property investment performance in Nigeria, using transaction rather than appraisal data.

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Section: Literature Reviewmentioning

confidence: 99%

Review of the methodological approach of analysing rental income of residential property in Abuja, Nigeria

Bello

Abdullahi

Atilola

et al. 2022

JFMPC

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“…Published research on African property markets is limited. Outside South Africa, published research on property markets in the continent has mainly been concerned with institutional structures and constraints on market development (Anim-Odame, 2009).…”

Section: Property Research and Developmentmentioning

confidence: 99%

Integrating the African Real Estate Market – An Agenda: the 18th AfRES Conference

Iwarere¹,

Williams²

2018

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Purpose -This paper examined stakeholders' perception on the competency attained by real estate graduates in Nigeria.Design/Method/Approach -The study adopted questionnaire survey conducted on 357 and 105 Estate Surveying and Valuation Firms in Lagos and Abuja respectively, representing an approximate 57 percent of the total number of practice firms in Nigeria. The questionnaire solicited information on practitioners' views on competencies, in terms of, knowledge, skills and attributes attained by real estate graduates in the industry. The respondents were asked to rank on a 7-point Likert scale, 24 knowledge areas, 10 skills and 10 attributes identified and conceptualized from literature. Their responses were analysed using frequency distribution and mean rating.Findings -The study revealed that practitioners were positive on their agreement to the graduates' attainment on only three (3) of the twenty four (24) identified knowledge areas, namely real estate agency, property management and property valuation. While ICT, communication, Personal/Professional development and Honesty were the skills and attributes attained respectively. This clearly suggests the need for stakeholders (academics, regulators and practitioners) to take urgent steps to bridge the obvious gap between the knowledge requirements of practitioners and the knowledge attained by graduates in the study area.Practical Implications -The findings of this paper can be used as framework for curriculum development and redesign as well as serve as a guide for real estate continuing professional development plan.Originality -This paper is one of the few that have identified stakeholders' perception on competencies attained by real estate graduates in Nigeria.

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“…Against this backdrop, Girouard and Blondal (2001) observe that house price risks and fluctuations have a bigger wealth effect than organized market equities. Anim-Odame (2010) reveals that housing returns between the period of 1992 to 2007 in the cities of Accra and Tema, Ghana are made of a relatively stable income return whereas capital growth for the same period was highly volatile. A fluctuation in house prices leads to a reduction in household wealth that reduces household expenditure (Campbell and Cocco, 2007).…”

Section: Introductionmentioning

confidence: 99%

Housing attributes and relative house prices in Ghana

Owusu‐Manu

Edwards

Donkor-Hyiaman

et al. 2019

IJBPA

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Purpose The study of house prices has become more relevant in recent times after the global financial crisis. Using a housing data set from three regions of Ghana (collated from real estate agents), the purpose of this paper is to estimate the relative importance of housing attributes to house prices. Design/methodology/approach The hedonic regression analysis conducted indicates that location is the most powerful determinant of house prices. Other relevant factors are the number of bedrooms, the number of floors, the total floor area, land size, age of the house and luxury finishing. Findings The implications of these results are many. Policy wise, the study provides an evidence-based empirical study that supports the need for better urban planning to improve communities, which in turn is associated with house price appreciations. Homeowners, investors and creditors, particularly mortgage lenders could be the immediate beneficiaries. Drawing on this, improved urban planning could mitigate strategic defaults that results from house prices falling below mortgage loan balances. This is important for financial market stability. Originality/value The paper provides a comprehensive and unique understanding of the hedonic determinants of house prices in Ghana. Future studies could examine the effect of location upon mortgage lending in Ghana.

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Real Estate Investment Market in Africa: The case of Ghana

Cited by 4 publications

References 0 publications

Review of the methodological approach of analysing rental income of residential property in Abuja, Nigeria

Review of the methodological approach of analysing rental income of residential property in Abuja, Nigeria

Integrating the African Real Estate Market – An Agenda: the 18th AfRES Conference

Housing attributes and relative house prices in Ghana

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