AN ASSESSMENT OF SOURCES OF FINANCE ON RESIDENTIAL PROPERTY DEVELOPMENT IN NASARAWA

AN ASSESSMENT OF SOURCES OF FINANCE ON RESIDENTIAL PROPERTY DEVELOPMENT IN NASARAWA 

ABSTRACT 

The focus of this study is to examine, an assessment of source of finance on residential property development in Nasarawa. The study attempts to explore the various sources of finance that are available for residential property development with a view to determining effective flow of funds. To achieve this some estate surveying and valuation firms in Nasarawa that engage in residential property development, some sources of financial institution that fund residential property development and some developers were examine through the use of questionnaires in order to know much about residential property development in terms of fundings. Simple descriptive statistical methods were used for the analysis and presentation of the data. The study shows clearly show that high interest rates to that of the numerous requirements from applicants for loan, which in most cases they find difficult to meet bedeviled the sources of finance in Nasarawa, beside the inflationary rate in the Nasarawa also contributes to the sources of finance in residential property development in Nasarawa. It recommended among others that the Nasarawa government should try to help in terms of financing in residential property development in Nasarawa.

CHAPTER ONE

1.0            INTRODUCTION

1.1     BACKGROUND OF THE STUDY

Housing is crucial to national development and socio-cultural growth in any human society. Development is universally acknowledged as the second most essential human need after food, and is considered a major economic asset in every nation, internationally, development is recognized as a factor for the assessment of human development and societal civilization (UNO 1976) Hayakawa (1983) noted that, “Housing which does not provide space for contemplation will not allow for the growth and development of individuality. Thus, housing not only contributes to the residential property development of man physically and mentally, but also contributes to the growth of culture and human morals, in a broader sense housing profoundly affects a wider aspect of family and community life and wellbeing. Residential property development is an issue that only touches on the life of an individual, but also has the potential to contribute to national development (Agbola, 1998).

In Nigeria, development is a space within which a generation of families expresses its existence and preserves the history and identities of lineage. Families discover themselves according to their lifestyle and dictates of the cultural values of the society to which they belong, the family residential housing, therefore is a symbol of social identity and community recognition.

Nevertheless the social and cultural values of people vary from one society or civilization to another. However, one of the peculiar features of most dwellings in many urban area in Nigeria is the absence of user responsive and culturally determined development.

Paramount among several reasons adduced on why meeting user needs and expectations is the lack of adequate knowledge of changes in user needs and preferences by architects and other professionals who design, construct, and maintain buildings. This lack of knowledge can evidently be attributed to inadequate research on this subject (Ibem etal, 2013).

The direct input of Nasarawa government and residential housing professionals has further aggravated the problem because the design of the majority of existing units are patterned along foreign development. Although residential property quality studies have gained increasing attention in recent times. However, little or no attention has been directed toward the aspect of residential property development in Nasarawa quality, which highlights the importance of residential property types and dwellings that meet the residential needs of end users in their quest for suitable shelter in Nasarawa.

1.2            STATEMENT OF RESEARCH PROBLEMS  

In the hierarchy of man’s needs, housing has been ranked second and as a result of this, housing provision has become a paramount cornerstone of the policies of various government both at federal and state levels in Nasarawa since independence in Nigeria. The consequences of the rapid rate of urbanization are most visible in the rapid deterioration of urban housing resulting in urban housing poverty especially as there is no proportionate increase in the number of housing stocks.

The house occupies a very unique position in the life of all human beings and standouts as one of the basic necessities of human beings after food as there is the innate desire of every man to own a decent house. It is most single especially in residential property development in Nasarawa.

1.3            AIM AND OBJECTIVE

The aim of this project is to examine an assessment of source of finance on residential property development in Nasarawa with a view to discover if there are problem requiring solution.

In order to achieve the aim stated above, the following objectives were pursued.

i.                   To identify the impact of the sources of finance

ii.                 To examine the sources of finance

iii.              To assess the sources of finance on residential property development.

iv.              To identify possible problem with the implementation on residential property development and

v.                 To make recommendation to the problem on the findings

1.4            RESEARCH QUESTION

i.                   What is the sources of finance

ii.                 What are the sources of finance and the important of it. Or purpose of finance in Nasarawa

iii.              What benefit has this made to people in residential property development in Nasarawa?

iv.              What are the types of residential property development in Nasarawa town?

v.                 What are the occupations of those that are into residential property development in Nasarawa?

vi.              How can we know the problem in residential property development in Nasarawa?

1.5            HYPOTHESIS

H0: There is no significant relationship between an assessment of sources of finance on residential property development in Nasarawa.

H1: There is significant relationship between an assessment of sources of finance on residential property development in Nasarawa.

1.6            SIGNIFICANCE OF THE STUDY

This project will help to know the sources of finance of residential property development in Nasarawa. This project will be useful to the whole Nasarawa people and to encourage them in the way of finance on their property development. Also students individuals or group carrying on research of a similar nature may find project useful in the future.

1.7            SCOPE AND LIMITATION

The project is concerned with analytical study of income on sources of finance of residential property development in Nasarawa. Although the scope of the study is large, some of them gain their income through salary and some through contribution for them to develop their residential property.

The following are the limitation of the study for a meaningful approach and critical analysis of a work of this nature one has to put into consideration the limited time and materials and confined to a specific area. As earlier stressed, the project will focus attention on residential property development in Nasarawa.

1.8            DEFINITION AND OPERATIONAL OF TERMS

Finance: The control of money, to provide money for who finances this organization.

Residential: Consisting of private houses without offices or factors.

Development: The act or action of developing or the state of being developed; a gradual unfolding; the development of a seed into a plant of his shop into a big business.

Property: That which is owned (and has some value) that care is my property; you can’t use it without my permission.

1.9            HISTORICAL BACKGROUND OF THE STUDY AREA

Historical Development Of Nasarawa State

Nasarawa state located  in North Central geopolitical zone of Nigeria, Nasarawa state was created in 1996 out of neighbouring Plateau state, the state known as the “Home of solid mineral” Nasarawa state has 13 local governments and those are Awe, Akwanga, Doma, Karu, Keana, Keffi, Kokona, Lafia, Nasarawa, Nasarawa-Eggon, Obi, Toto, and Wamba.

Nasarawa state was one of the six states created in 1996 by the military regime of late General Sani Abacha, the state was carved  out of the Plateau state and ever since it was created, the state has grown to become one of the tourist state with its magnificently beautiful landscapes and spectacular highlands.

POPULATION OF THE PEOPLE

Nasarawa has a diverse range of ethnic groups indigenous to the state and according to the 2006 census, the state has a population of a little less than 2 million, very hospital and culturally rich people, Nasarawa is composed of different ethnic groups each with it own district local dialect.

GEOGRAPHICAL ISSUE  

Nasarawa state has a total land area of 27,137.8 sqkm and it shares borders in the west by the Federal Capital Territory Abuja, in north by Kaduna state, in south by Benue and Kogi state, and in the east by Plateau and Taraba.

MAP OF NASARAWA STATE

ECONOMIC ACTIVITIES

Nasarawa main economic activity is agriculture, cash crops such as yam, cassava and egusi (melon) production of minerals such as salt is also another major economic activity in the state; Nasarawa produces a large proportion of the salt consumed by the country.

NASARAWA LOCAL GOVERNMENT

Nasarawa state has 13 local government such as Lafia, Akwanga, Keffi, Karu, Wamba, Nasarawa, Doma, Nasarawa – Eggon, Obi, Toto, Awe, Kokona.

CHAPTER TWO

2.0            LITERATURE REVIEW

2.1     INTRODUCTION

Proper financing is all important to successful property investment in residential property development, various forms of finance on varying terms from diverse investing agencies are available to the property market. The principle field where various forms of investment finance are employed is that of development where very loan has to be specifically tailored for an individual scheme and the particular stages within the scheme.

Since residential property development in Nasarawa in particular involves huge capital expenditure, finance therefore an essential input, the nature of which is to provide capital to enable the enterprise operate commercially. The cost and availability of finance for residential property development can influence the viability of such development. Inspite of the importance of development finance in residential property development there is dearth place by whom, or the method used. Though this is not unexpected given the general characteristics of property development funding: there is no central agency or institution to co-ordinate the business of residential property funding in Nasarawa.

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