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Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month - Properties - Nairaland

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Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Omooba77: 6:54am On Aug 01, 2016
The number of vacant properties in the upper class real estate neighbourhoods of Lekki, Victoria Island and Ikoyi has risen by 72 percent over the last 18 months, a report by the Financial Derivatives Company Limited (FDC) has stated. The FDC’s Vacancy Factor Index (VFIX) for 2nd Quarter June 2016 report attributed the rise in the number of vacant properties, based on the housing stock as at January 2015, to a combination of rising inflation, GDP contraction, falling consumer confidence and increasing unemployment rates contrived to lower demand for housing.

“Our urban real estate vacancy factor index increased for the second consecutive quarter as aggregate demand and supply forces remain in disequilibrium – a dynamic that continues to persist in the real estate market. “The VFIX indicates a paradoxical phenomenon where supply continues to trend upwards but effective rents remain stubbornly high,” the company stated.

Specifically, the report stated that there was a 6.6 percent increase in vacant residential properties in the second quarter. “The residential VFIX has increased by 6.6 percent from 177 in March to 189 in June 2016. Commercial VFIX on the other hand has remained flat at 148.

The huge gap between both indices is due to the fact that residential properties have a higher sensitivity to economic downturn. A residential property can easily be vacated without the tenant incurring a huge cost. Business, however, will face high costs for moving and so the decision is not made as quickly. For example, companies will face switching costs like changing addresses on business cards and will most likely lose some customers as a result,” the report stated.

Economic indicator

“The rise in the index was not surprising, when you consider the 0.36 percent contraction in GDP in the first quarter. A further contraction of 1.5 percent is expected in the second quarter thus putting the economy into a recession. As a lagging economic indicator, the housing sector is likely to remain flat until the stimulus has transmitted through the system. Our expectation is that a point of inflexion of the index will be evident in the first quarter of 2017.

Typically, high vacancy rates imply increased supply, which should translate to lower rents. However, rents in these areas have remained inflated above fair value and continue to be responsible for the high rate of delinquency and abandonment.”

The report further stated that Lekki suburb, with the largest number of residential developments, recorded the highest vacancy rates, while Ikoyi, an elitist suburb area famed for its overpriced properties – mainly new apartment blocks compared to stand-alone houses, has the lowest vacancy rate amongst the three selected locations due to the many derelict lands that exist within the area.

The FDC report asserted that a drop in the vacancy factor will only occur when there is an expansion in GDP and the PMI (or Purchasing Managers’ Index, an economic indicator derived from monthly surveys of private sector companies), an increase in the hotel occupancy rates, inflow of foreign portfolio and foreign direct investment as a result of the new flexible exchange rates, growing consumer confidence and most importantly, the flow of state and federal spending.

Outlook

FDC projects an outlook of further decline in demand for housing until probably the last quarter of the year, when economic activities are expected to pick up. “Given the economic conditions currently faced, we do not expect a quick recovery of the VFIX, as there is a time lag for the market to return to equilibrium.



We expect demand for housing locally to shrink further initially due to lower disposable income and a move from prime areas to more affordable locations. We also expect, in the short-term, new developments under construction. This will increase the supply of properties. From fourth quarter 2016 onwards, we project a pickup in activities as the economy gradually recovers mainly through demand for housing by expatriates,” it stated.


http://www.vanguardngr.com/2016/08/economic-downturn-vacancies-lekki-vi-ikoyi-properties-rise-72-18-months/

3 Likes 1 Share

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by kossyablaze(m): 7:04am On Aug 01, 2016
Hehehehe mk dem come taste face me I face u small

24 Likes 1 Share

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Omooba77: 8:34am On Aug 01, 2016
Everything don fall finish make God help us. Only lalasticlala fit get money buy house now because he dey work 24/7

32 Likes 1 Share

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Lukmann1: 12:27pm On Aug 01, 2016

As if lekki is the only best place to live in, after all their high prices accommodation, who will lived there. ..

6 Likes 1 Share

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by BOBBYTRICK: 12:27pm On Aug 01, 2016

1 Like 2 Shares

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Nobody: 12:28pm On Aug 01, 2016
Its Okay.

Let me hear that boohhary is not working.

6 Likes

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Moz22: 12:28pm On Aug 01, 2016
My grandmother likes to wear skirt
Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by AntiWailer: 12:28pm On Aug 01, 2016
Why live in a rented apartment of 5million per annum.


I knew I get problem years ago when I saw Dangote standing not too far from where i was with Bold 5 and me poor M0f0 too carry Bold 5 dey form Big Boy.

Look around, you will see Same iPhone as the one Kim Kardashian is using with these girls.

Meanwhile, Kim K is worth $150 million = 42,000,000,000 (42 Billion Naira angry angry) @ 280 per dollar. grin grin grin

75 Likes 11 Shares

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by sCun: 12:28pm On Aug 01, 2016
Yoruba Muslims come and blame GEJ.

29 Likes 1 Share

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Newsi: 12:28pm On Aug 01, 2016
Sai Buhari! Is this the change?

10 Likes

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by NwaNimo1(m): 12:28pm On Aug 01, 2016
Buharinomics at work....

15 Likes 1 Share

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by MrKamar(m): 12:28pm On Aug 01, 2016
Omooba77:
Everything don fall finish make God help us. Only lalasticlala fit get money buy house now because he dey work 24/7
grin is he a bot? lala, la joke o cheesy
Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by oyek691: 12:29pm On Aug 01, 2016
Even the rich folks are feelings this poor economic.
God bless my dear country. embarassed
Amen. #Greatagain

1 Like

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Nobody: 12:29pm On Aug 01, 2016
hmmmm
Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by herzern(m): 12:29pm On Aug 01, 2016
embarassed
Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Sijo01(f): 12:30pm On Aug 01, 2016
Is the vacancies for work so that I can starto apply embarassed

11 Likes

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Integrityfarms(m): 12:30pm On Aug 01, 2016
No be who get money go buy properties
And the owners will want to sell at cut throat prices !

4 Likes

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Memphis357(m): 12:30pm On Aug 01, 2016
The after effects of the CHANGE mantra. Things are getting from worse to worst.

11 Likes 3 Shares

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Nobody: 12:30pm On Aug 01, 2016
cheesy cheesy Lakowe uld be congested soon

2 Likes 1 Share

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Bisjosh(f): 12:32pm On Aug 01, 2016
AntiWailer:
Why live in a rented apatment of 5million per annum.

Many live above their means there grin

3 Likes

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by TVTKOKO(m): 12:32pm On Aug 01, 2016
sCun:
Yoruba Muslims come and blame GEJ.
is Yoruba Muslims another different tribe angry angryPLEASE STOP THE NONSENSE DIFFERENCIATION NOW!!!
Yoruba is Yoruba christian or muslim

19 Likes 2 Shares

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by gidjah(m): 12:32pm On Aug 01, 2016
that's the way it should BE,we All should be our neighbors keeper and share in this pain of economic degradation. And the beat goes ON!

1 Like

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Pavore9: 12:33pm On Aug 01, 2016
Reality sets in! cheesy

5 Likes

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by ephi123(f): 12:33pm On Aug 01, 2016
Economy is seriously suffering. Thank You PMB. Three gbosas for you lipsrsealed undecided

5 Likes

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by salabscholar01(m): 12:33pm On Aug 01, 2016

2 Likes

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Nobody: 12:34pm On Aug 01, 2016
cheesy I dey Pack go V/I , Dis Ajegunle don tire me finish grin grin grin

15 Likes

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Adesiji77: 12:34pm On Aug 01, 2016
Victoria Ireland here I come! cheesy

1 Like

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by wristbangle: 12:35pm On Aug 01, 2016
Instead of reducing the price for average citizens to rent the properties, they remain stagnant or rather increased the fee making it difficult even for the rich to go for it.

Why would I put 5 million on a rent where I can use such money to buy land and build my house to a completed state at Ibafo, igando or agbara.

4 Likes

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by Deen77: 12:36pm On Aug 01, 2016
sCun:
Yoruba Muslims come and blame GEJ.

Who do we blame, PDP wasted all our savings on importation and subsidies payment in trillion instead of building a refinery to stop importation and refine locally.

No survival resources,Nigeria savings is zero. If you can't manage the good times how can you manage the bad times.

We finished ourselves with importing petroleum products an essential commodities for 16 year's paying trillion naira subsidies something we can produce locally if our leaders are sincere and serious.

19 Likes 1 Share

Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by sammyj: 12:37pm On Aug 01, 2016
CHESUS !!!! grin grin
Re: Economic Downturn: Vacancies In Lekki, VI, Ikoyi Properties Rise 72% In 18 Month by free2ryhme: 12:37pm On Aug 01, 2016
No be who get money to collect over inflated apartment. Since Dasuki money don finish everybody go enter reverse

5 Likes

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