Real estate developers are pulling innovative offerings out of the hat in anticipation of the dulling effect that the coming elections and the devaluation of the naira might have on the market.
Much of the plan entails offering realistic and competitive prices to intending homebuyers, BusinessDay investigations have shown.
Also in the bouquet of the real estate developers strategies is a design to shift away from luxury apartments to more affordable housing and a deliberate move towards new investment opportunities, discounts for over-priced properties, aggressive marketing and flexible payment plans.
The new move, analysts say, is key to wooing homebuyers to a likely pricier market, as well as lure savvy investors, as they seek an escape route from a bearish stock market.
“The first quarter of 2015 will be dull because of the elections. We foresee only six months of activity in the year. It’s going to be a tough year, though the demand is there. We expect developers to slightly reduce the price of their property to create a semblance of sales,” Kola Ashiru-Balogun, managing director, ARM Properties, said in a Lamundi report made available to BusinessDay.
Ayodele Thomas, managing director, Kings Court Realtors, who shared the same view, observed that the uncertainty in the global economy, as a result of the fall in oil prices would translate into scarcity of funds, thereby slowing activity in the real estate sector , especially at the high end market.
Ayodele, who also predicted an active rental market in the mid-income housing segment, was confident that despite the expected snail speed of the market, it still boasts of huge investment potential for savvy investors.
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“With the low demand in real estate in 2015 and scarcity of funds, prices will have to come down in 2015. However, it is better to invest when prices are bottoming up than when rising, as we will likely see an upward shift from the third to the fourth quarter of the year,” he said.
Lawal Olaide Tresvant, business development, Efficacy Homes Limited revealed that on account of the February elections, buyers will likely be cash constrained, hence, his firm’s decision to explore the option of providing homebuyers with affordable housing and new investment opportunities, as low as N10million
Also, Lekki Gardens, a new but dominant player in the Lagos real estate scene and beyond, has commenced a new promo where homebuyers can get a unit of two, three or four bedroom apartments free of charge, when they buy two units of the same apartment outright, in some of their select estates.
Azuka Ugboh, media director, GT Rich Investment, promoters of Lekki Gardens limited, explained that though his firm is not considering price reductions for its properties, it will continue to seek new ways to excite its clients with its products.
For promoters of the Lagos Home Ownership Mortgage Scheme (HOMS) a more strategic way of enticing homebuyers to its scheme, is the new Rent-to-Own programme set to be unveiled in near future.
This initiative, Yomi Oladapo, Public relations Officer, LagosHOMS, says, will no doubt wet the appetite of mid-income earners who have aspired to benefit from the state’s illustrious scheme.
“The government might not be able to discount the market value of houses under the scheme, but we are committed to exploring avenues that will enhance the affordability of the units and one other Rent-to-Own initiative,” Oladapo told this reporter.
Maureen Orazulike, regional director, Century 21 Nigeria, a specialised real estate marketing firm, revealed that while most developers are reluctant to sell their products at discounted prices, as a result of the decline in naira, other strategies are being employed to woo prospective homebuyers.
“While discounts could work for over-priced properties, as a marketing firm, we have had to also employ other strategies for rightly priced properties.
“Some of the innovations are Rent-to-own, organising open house for newly built properties to intimate intending homebuyers with these properties and other aggressive marketing approach,” she said.
ODINAKA MBONU
