land 4 sale at Mowe-Ofada @375 per plot

[AbsoluT]

clearly a bubble burst is not far away. the danger in Nigeria is that '' it will happen suddenly''

[prince dagbolu]

Originally Posted by ayemco

Property prices soar at Mowe-Ibafo
By Rasheed Bisiriyu
Published: Monday, 20 Oct 2008
As more estates spring up in Mowe, Ibafo and Ofada, all small towns in Ogun State, on the border of the Lagos-Ibadan Expressway, property value has appreciated on the axis by over 150 per cent in the last one year.

Before now, Mowe-Ibafo used to be known mainly as prayer centres or camps for different religious groups, while Ofada was famous for local rice.

But all that is changing. And considering its proximity to Lagos, observers say the rate of estate development on that axis may rival Lekki, which is considered the fastest developing corridor in Africa.

For instance, it was gathered on Friday that the cost of land and houses in some estates had appreciated by between 50 per cent and 300 per cent in the past year. And many of the estates are still under construction

A Lagos-based real estate development company, Messrs Propertymart Limited, which recently commenced construction work on its new project at Mowe, the Palms Garden Estate, gave a promo price of N475,000 for a plot of land.

According to the Head of Marketing, Mr. Adesope Adeyinka, the price would soon shoot up to N750,000 as soon as the limited plots for the promo offer are exhausted.

Similarly, a plot of land that sold for N450,000 at Crystal Park Estate in August 2008 jumped to N750,000, representing some 60 per cent increase. Messrs Vetra Ventures Limited is developing the estate.

Another developer, City Planning Properties Limited, has reportedly jacked up the price of a plot of land at its Sherry View Garden, Ofada, under the site and service scheme by 100 per cent. It was increased from N400,000 to N800,000.

The Chief Executive Officer of the property company, Mr. Niyi Odutayo, said last month that 1,000 plots had already been out of 1,300 plots available for sale.

Honeyland is also a largely site and service scheme on 50 acres of land at Ofada being developed by OMF Properties Limited, a subsidiary of Oasis Savings and Loans. According to the Managing Director, Oasis, Mr. Rotimi Omosehin, the estate is planned as a low-cost housing to accommodate 210 plots, out of which 170 plots have been sold in less than two months.

The story is the same at the New Creation Properties Limited’s “Covenant Garden City, which reportedly recorded an over 50 per cent price increase. A plot of land that sold for N500,000 in July is said be going for N800,000.

An over 300 per cent price increase was reported in the last one and a half years at the “Golden Heritage City” as the cost of a plot of land rose from N280, 000 to N1m.

Developers and property managers are also raising prices of houses and rent rates.

For instance, the average cost of a three-bedroom bungalow is between N5m and N6m, up from between N2.2m and N3.6m less than two years ago.

A source also recalled that occupants of some estates were stunned recently when their landlords or estate managers confronted them with upward price reviews.

Ayemco, I told you this would happen. Because, Nigeria is still a developing country. We have not even built 30% of the houses we need. All the forest you see now are estates of the future. They have one advantage, if managed properly by Town Planners, they will develop better than the existing Towns.

I see no reason why Lagos to Mowe corridor cannot compete with the Lekki Corridor. Mowe is actually more attractive to people who do not want to waste N5m on Raft Foundation, before they can even start building. Furthermore, Nigerians love living close to prayer centres and camps.

[prince dagbolu]

Originally Posted by AbsoluT

clearly a bubble burst is not far away. the danger in Nigeria is that '' it will happen suddenly''

AbsoluteT, no bubble will burst on the Mowe corridor until such a time when the prices get to a crazy level like Lekki. Personally, by todays' market, i would rather buy a 650sqm plot of land into an estate in Mowe for N1.5m than to buy the same size of land for N5m on the Lekki corridor, because the real cost of Lekki land is not N5m, but N10m after considering the N5m needed to make the land strong enough to build a house.

Finally, i heard that Raft Foundation houses are only guarateed for 50 years.

[hispy99]

Originally Posted by prince dagbolu

AbsoluteT, no bubble will burst on the Mowe corridor until such a time when the prices get to a crazy level like Lekki. Personally, by todays' market, i would rather buy a 650sqm plot of land into an estate in Mowe for N1.5m than to buy the same size of land for N5m on the Lekki corridor, because the real cost of Lekki land is not N5m, but N10m after considering the N5m needed to make the land strong enough to build a house.

Finally, i heard that Raft Foundation houses are only guarateed for 50 years.

Just curious though, why is the cost of a plot of land jumping up by 100-300% in the space of one year? Has oil been discovered under the ground?

[ayemco]

Originally Posted by prince dagbolu

Ayemco, I told you this would happen. Because, Nigeria is still a developing country. We have not even built 30% of the houses we need. All the forest you see now are estates of the future. They have one advantage, if managed properly by Town Planners, they will develop better than the existing Towns.

I see no reason why Lagos to Mowe corridor cannot compete with the Lekki Corridor. Mowe is actually more attractive to people who do not want to waste N5m on Raft Foundation, before they can even start building. Furthermore, Nigerians love living close to prayer centres and camps.

Prince, you don come with this your Raft foundation again shaa.... My sadness however, lies in the fact that as this area is growing with interest, it has not occurred to the stae goverments in charge ti start looking and planning infrastructral facilities like drainage, canals, lighting, waste disposal, etc.. Otherwise, this place may end up again as a dump..

[billions]

Originally Posted by hispy99

Just curious though, why is the cost of a plot of land jumping up by 100-300% in the space of one year? Has oil been discovered under the ground?

Probably bk many people now borrow money to buy properties....

[hispy99]

Originally Posted by billions

Probably bk many people now borrow money to buy properties....

I hope those borrowing have the resources to repay and are not merely speculating.

[prince dagbolu]

Originally Posted by hispy99

Just curious though, why is the cost of a plot of land jumping up by 100-300% in the space of one year? Has oil been discovered under the ground?

Hispy, this is an interesting question. The answer is simple. Demand for land in this area is high. But, I suspect most of the buyers are speculators. They have no intention of building on the land. They are just buying and holding on to the land to re-sell in the future. Its crazy but you cannot legislate against investors behaving badly.

[henry_bonds@yahoo.co.uk]

Originally Posted by prince dagbolu

Hispy, this is an interesting question. The answer is simple. Demand for land in this area is high. But, I suspect most of the buyers are speculators. They have no intention of building on the land. They are just buying and holding on to the land to re-sell in the future. Its crazy but you cannot legislate against investors behaving badly.

Speculative buying or holding is legal and part the market strategy. There is nothing bad about it.

[prince dagbolu]

Originally Posted by henry_bonds@yahoo.co.uk

Speculative buying or holding is legal and part the market strategy. There is nothing bad about it.

What is being done is perfectly legal. But, guess what? its partly the reason for the current credit crunch. Real estate becomes too expensive and becomes a bussiness for some rather than a necessity of life which shelter is. Finally, if speculators buy most of the land and hold on to them. We may then have a situation of the new Towns remaining bushes for a long time. They will not develop the land, and those willing to develop will not be able to buy, because of the crazy prices.

[hispy99]

Property prices rise 150% despite stock market meltdown

Tuesday, 04 November 2008 00:50 BLESSING ANARO & CHUKA UROKO

Elsewhere, the strength of a country’s stock market mirrors the state of its economy. But for Nigeria, this may just be a theoretical statement as developments in the Nigerian Stock Exchange (NSE) are yet to impact on the prices of properties.

While market analysts expect property prices to come down in response to falling share prices, BusinessDay investigations revealed that on the contrary, property prices are rather increasing. Emmanuel Abolo, chief economist/head market risk management, Access Bank plc, agree that there is a correlation between the stock market and other sectors of the economy. His position on if falling share prices should affect property prices is that there is likely going to be a time lag before any impact will be felt on the property market.

For instance, in November last year, Refuge Home Savings and Loans (mortgage bankers), as part of its property development drive, launched what it called “Beaufort Royale 2 Estate” in Mowe, a residential estate with a home-plan for developments of 2 and 3-bedroom detached bungalows with spacious rooms. Each of these will be sitting on a standard plot of land measuring 324 square metres, large enough to accommodate four cars and a garden at the back.

From the date of launching up to January-February this year, each of the 324 square-metre plot was selling for N350,000. Today, the same plot of land goes for N900,000 representing over 100 percent increase. Similarly, at Twin City Phase One, developed by Cross and Churchhill Realtors Limited, an integrated real estate company, a plot of land was sold for N250,000 when it was launched in October last year. From this price, it went for N375,000 when the second phase of the estate was launched in January this year.
When the company came up with another juicy mega estate project known as Green Oak Park, a fully serviced estate with properly laid out plots in a secured and gated environment, the price jumped to N550,000 with the prospects of moving it up to N660,000 by November and N750,000 by December.

This is in spite of the fact that the stock market lost about N4 trillion to the ravaging forces of demand and supply. But the property market remain the most active at the moment, with some saying it is even expected to gain from expected investment shifts that will see savvy investors moving cash to areas with high dividend potentials.

Managing director and chief executive officer of Union Homes Savings and Loans plc, Austin Ekundayo Aikhorin, told BusinessDay that in the circumstance, “the next best investment alternative is the property market; it is the way to go.” Aikhorin hoped that the property market would take an upturn because of the melt down that would sway investment in that direction. He added that movement of oil workers away from the insecurity in the troubled Niger Delta region was sure to buoy up activities in the property sector.

Ifeanyi Onuorah of the Springmortgage Bank agrees with the Union Homes’ boss, pointing out however, that “people are not going to move their cash from the stock market to the property market because losses have already been made.” Onuorah who is the managing director and chief executive officer of the bank added that “people who have money for investment would rather go to the property market.” On whether the melt down has any spiral effect on mortgage, Aikhorin disclosed that credit underwriting was still very low, adding that very few people were being financed by mortgages.

From global perspective, he said Nigeria was the least likely to be affected by the global stock price crash, explaining that “because of the magnitude of the housing stock deficit we have in Nigeria, it will take a while before property development here will begin to feel the impact of the global recession.”

He dismissed direct impact of the recession on mortgage financing, pointing out however that indirectly, it might have little impact by constraining funds availability for mortgage financing.

[prince dagbolu]

Originally Posted by hispy99

Property prices rise 150% despite stock market meltdown

Tuesday, 04 November 2008 00:50 BLESSING ANARO & CHUKA UROKO

Elsewhere, the strength of a country’s stock market mirrors the state of its economy. But for Nigeria, this may just be a theoretical statement as developments in the Nigerian Stock Exchange (NSE) are yet to impact on the prices of properties.

While market analysts expect property prices to come down in response to falling share prices, BusinessDay investigations revealed that on the contrary, property prices are rather increasing. Emmanuel Abolo, chief economist/head market risk management, Access Bank plc, agree that there is a correlation between the stock market and other sectors of the economy. His position on if falling share prices should affect property prices is that there is likely going to be a time lag before any impact will be felt on the property market.

For instance, in November last year, Refuge Home Savings and Loans (mortgage bankers), as part of its property development drive, launched what it called “Beaufort Royale 2 Estate” in Mowe, a residential estate with a home-plan for developments of 2 and 3-bedroom detached bungalows with spacious rooms. Each of these will be sitting on a standard plot of land measuring 324 square metres, large enough to accommodate four cars and a garden at the back.

From the date of launching up to January-February this year, each of the 324 square-metre plot was selling for N350,000. Today, the same plot of land goes for N900,000 representing over 100 percent increase. Similarly, at Twin City Phase One, developed by Cross and Churchhill Realtors Limited, an integrated real estate company, a plot of land was sold for N250,000 when it was launched in October last year. From this price, it went for N375,000 when the second phase of the estate was launched in January this year.
When the company came up with another juicy mega estate project known as Green Oak Park, a fully serviced estate with properly laid out plots in a secured and gated environment, the price jumped to N550,000 with the prospects of moving it up to N660,000 by November and N750,000 by December.

This is in spite of the fact that the stock market lost about N4 trillion to the ravaging forces of demand and supply. But the property market remain the most active at the moment, with some saying it is even expected to gain from expected investment shifts that will see savvy investors moving cash to areas with high dividend potentials.

Managing director and chief executive officer of Union Homes Savings and Loans plc, Austin Ekundayo Aikhorin, told BusinessDay that in the circumstance, “the next best investment alternative is the property market; it is the way to go.” Aikhorin hoped that the property market would take an upturn because of the melt down that would sway investment in that direction. He added that movement of oil workers away from the insecurity in the troubled Niger Delta region was sure to buoy up activities in the property sector.

Ifeanyi Onuorah of the Springmortgage Bank agrees with the Union Homes’ boss, pointing out however, that “people are not going to move their cash from the stock market to the property market because losses have already been made.” Onuorah who is the managing director and chief executive officer of the bank added that “people who have money for investment would rather go to the property market.” On whether the melt down has any spiral effect on mortgage, Aikhorin disclosed that credit underwriting was still very low, adding that very few people were being financed by mortgages.

From global perspective, he said Nigeria was the least likely to be affected by the global stock price crash, explaining that “because of the magnitude of the housing stock deficit we have in Nigeria, it will take a while before property development here will begin to feel the impact of the global recession.”

He dismissed direct impact of the recession on mortgage financing, pointing out however that indirectly, it might have little impact by constraining funds availability for mortgage financing.

Nice one hispy. It looks like my investments and believe in Mowe are starting to pay off.

[Bigpr]

Someone wrote earlier about the domino effect of folks "banking" land for investment. There is truly nothing wrong or illegal about this in the same way that there was nothing wrong or illegal with some of the financial arrangements that has brought Lehman Brothers and Bear Sterns to its knees!!! Part of the problem in this as well as in Nigeria is that there is little government regulation so speculation is allowed to go unfettered. For example, a Government scheme is supposed to be a safer place to invest. But what makes these so called estates boom is the amount of traffic that goes through it. If every land owner simply bought, held on and then sold on every two years, the place will remain just a bush. You will then have a handful of folks who will build one fine house, surrounded by- you guessed it - bush.

I understand that Gov. Fashola has given some land owners in Isheri North an ultimatum to start developing their land or get refunded what they paid for it. Whether this will work or not is another issue as such people may be able to bribe their way out of repossession.

In the UK, housing developers were accused in some circles of banking land or new build properties thereby creating an artificial glut or demand. this was about a year or two ago. Now, most mortgage lenders WILL NOT touch new build properties because they automatically believe that it has been overvalued from day one. I suppose that the difference in Nigeria is that there is such a shortage of accommodation that developers and investors will yet get away with murder.

I just hope that Gov. Fashola's threat will be enforced otherwise a lot of these estates will just be ghost towns for years to come making the existing urban centers increasingly congested.