Property is a bundle of rights whose value is
determined by the interplay of various factors classified into accessibility,
environment, Neighbourhood and property characteristics. This study access the
relationship between infrastructure and property value in Agege area of Lagos
metropolis. In other to achieve the research objectives, questionnaires were
administered to two sets of respondents: Estate firms and Residents in Agege
Local government area of Lagos. The first part represent the demographic
details of the respondent. The sample were drawn from the residents in Agege
and Estate firms around the Area including Ikeja and its Environs. The data
collected were analysed using some standard statistical method like tables and
charts and findings were interpreted accordingly with the use of percentage.
For the purpose of this research, 120 copies of research questionnaire were
administered, 90 copies were given to residents and 30 copies to estate firms
out of which 93 copies were retrieved and analysed, 70 copies were retrieved
from residents and 23 copies from Estate firms in selected areas.
This study revealed that different infrastructural
attributes affect property value in the area of study.
TABLE OF CONTENTS
Table of contents vi
1.1 Background to Research Study 1
Statement of the Problem 3
1.3 Research Question 3
and Objectives 4
of Study 4
of Study 5
of Terms 5
CHAPTER TWO: LITERATURE REVIEW
2.1 What is Infrastructure 7
2.2 Concept of Infrastructure in Relation to
Property Value 9
2.3 Types of Infrastructure 14
2.4 Demands for Infrastructure 16
2.5 Attitude and Willingness to Pay for
2.6 Concept of Property Value 22
Factors Affecting Residential
Property Value 23
2.8 Constraints of Effective Service
Delivery of Urban Infrastructure 24
2.9 The Impact of Infrastructure Provision on
Residential Property Value 25
CHAPTER THREE: RESEARCH METHODOLOGY
3.1 Introduction 27
3.2 History of Study Area 27
3.3 Research Design 27
3.4 Sample Population and Selection 28
3.5 Methods of Data Collection 28
3.6 Data Analysis 29
Study Limitations 29
CHAPTER FOUR: DATA COLLECTION, ANALYSIS AND PRESENTATION
4.1 Introduction 30
4.2 Data Presentation and Analysis 30
4.3 Section A (Residents): Demographic Data 31
4.4 Responses from
Estate Firms 35
Analysis of Section B: Research Questions 37
Surveyor’s Assessment of the Attributes of the Area in Terms
of Infrastructural Amenities 43
CHAPTER FIVE: INTRODUCTION
of Findings 45
5.2 Recommendations Based on Research
5.3 Conclusion 47
5.4. Area of Further Study 47
1.1 BACKGROUND TO
Infrastructure plays a key role in the
well being of developed and developing nations and its importance to economic growth
and development cannot be underestimated or overlooked. It is one of the basic
facilities and systems serving a country, city, or area, including the services
and facilities necessary for its economy to function. It typically
characterizes technical structures such as roads, bridges, tunnels, water
supply, sewers, electrical grids, telecommunications, and so forth, and can be
defined as "the physical components of interrelated systems providing
commodities and services essential to enable, sustain, or enhance societal
living conditions. Infrastructural development influences the housing sector
and it is one of the determinants of the value of property in the housing
subsector. Housing represents one of the most basic needs of man and it has a
profound impact on health, welfare and productivity of individuals. For housing
to produce these impacts, it must be adequately provided with functional
infrastructures. One of the veritable parameters and assessment indicator of
status of any spatial, especially urban system is the state of infrastructure.
The efficiency of any form of human activity system including an urban area
largely depends on provision of efficient infrastructural facilities and
services (Babarinde 1998). The significance as well as the quality and coverage
of infrastructural facilities have a major impact on the standard of living,
property value and economic growth. Its role in the proper functioning of an
urban area cannot be over emphasized.
According to Fox (1994), infrastructures are those services
derived from a set of public work traditionally provided by public sector to
enhance the private sector production and allow for household consumption. Nubi
(2002) describes infrastructure as the aggregate of all facilities that allow a
city to function effectively.
Janet Rivers and Michael Heaney have
connected infrastructure investment to all facets of economic development. This
almost always includes an increase in property values, which is not a problem
since the increase is always offset by increasing opportunities and incomes in
the general vicinity. The closer a residential area is to new infrastructural
projects, the higher the increase in its value. In addition, Rivers and Heaney
also found that the reverse relationship is true: Failing infrastructural
investment is closely related to falling property values. They go so far as to
hold that decaying or neglected infrastructure is a major determinant of
economic decay and recession.
In developed countries of the world where
infrastructures are well developed and given top priority, Infrastructure has
played a key role in promoting and sustaining rapid growth in all sectors of
their economy including the housing-property subsector of these countries.
Properly designed infrastructure can also make growth more inclusive by sharing
its benefits with poorer groups and communities, especially by connecting
remote areas and small and landlocked countries to major business centers.
The relationship between infrastructural development and property
value also exists in the developing world. In Nigeria for instance where the
federal government over the past few years have embarked on massive
infrastructural development in all regions of the country after years of
neglect, every sector of the economy including the housing sector which has
experienced an unprecedented boom in patronage as well as increase in value of
properties in areas that have high infrastructural development. Professor M.A.
Adebayo of the University of Lagos, found strong relationships between property
values, economic development and infrastructural development. Lagos which the commercial capital and ranked the
highest in terms of infrastructural development has a result of the commendable
efforts made by the slate government, properties in the state command the
highest value in the country. Not only is there a connection between public
investment and the financial values of local housing, but people arc clearly
willing to pay more for a house or business if they know there is, or was,
substantial public investment in the area.
1.2 STATEMENT OF THE PROBLEM
This project examines the relationship
between infrastructures (roads, electricity, water, drainage facilities &
waste disposal system), effects of these infrastructures on property value and
cost and how the key players like estate firms and residents of Agege area are
at the receiving end of the effects. The level of neglect of infrastructural
development over the years as well as the deficient and deteriorating state of
the few available ones is becoming more alarming and worrisome due to the
inability of the public sector to meet up with its social responsibilities to
the people. The availability and inability of infrastructural amenities may
influence proper value and cost positively or negatively.
1.3 RESEARCH QUESTION
1. What are the existing infrastructure in study area?
2. What is the demand level for infrastructure in the study area?
3. What is the willingness to pay for specific infrastructure in the
What is the extent to which
these infrastructure affect the value of residential property in the study
1.4 AIM AND OBJECTIVES
This research is aimed at assessing how much value is added to
residential property for specific infrastructure project in the study area.
The objectives however include:
1. To examine the existing infrastructure in the study area
2. To ascertain the demand level for infrastructure in the study area
3. To identify the willingness to pay for specific infrastructure in
the study area
4. To ascertain the extent to which these infrastructure affects the
value of residential property in the study area.
1.5 SIGNIFICANCE OF
Property Market is very dynamic and complex sector which
transverse a vast array of components, institutions, socio-economic and
historic dimensions. This research examined the influence of infrastructural
amenities on property as well as look at the challenges faced in
infrastructural development in Agege area of Lagos. In addition to the above,
the study will be a reference material for students, scholars and other
researchers. In addition, this study will create awareness to individuals,
professionals, investors, communities and the society at large on how selected
infrastructure determines residential property values. Aside the contributions
made to knowledge, the research would go a long way in making possible mass
evaluation of properties, help guide property investors on areas of potential
returns on investments. The research would also be significant to government on
the type of infrastructures to be provided in certain areas.
will guide investors on where to invest taking into consideration unavailable
infrastructural facilities. For this reason, it will be significant to the
This research will be beneficial to the property owners and
residents in the study area by providing adequate information on availability
and state of infrastructure.
This study will be useful in providing regulatory guideline for
It will assist providers of infrastructures in planning and budgeting
resources and allocations to areas where it is most needed.
1.6 SCOPE OF STUDY
will evaluate the relationship between infrastructure and property value in
Agege area of metropolitan Lagos. Various infrastructure includes but not
exhaustive; Telecommunication infrastructure, Drainages/sewage infrastructure,
Portable water supply, Electricity, Health facilities, Educational infrastructure,
Sanitation and solid waste disposal system. This study therefore attempts to
examine the extent to which this infrastructure contributes to residential
property value in the study area. It would also look at the challenges faced in
infrastructural development in an attempt to improve the value of properties in
Agege area of metropolitan Lagos.
1.7 DEFINITION OF TERMS
Infrastructure: This refers to the
fundamental facilities and systems serving a country, city, or area, including
the services and facilities necessary for its economy to function.
HOUSE: This is s a building that functions as a home for humans or other
creatures, ranging from simple dwellings such as rudimentary huts of nomadic
tribes to complex structures composed of many systems.
HOUSING: This is the shell or structure of dwellings. It is generally
referred to the social problem of ensuring that members of society have a home
in which to live, whether this is a
house, or some other kind of dwelling, lodging, or shelter.
URBANIZATION: This is a population shift from rural to urban areas.
REAL PROPERTY: This is any
subset land that has been legally defined and improved thorough direct or
indirect human efforts, it includes: buildings, wells, dams etc.