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By Maduka Nweke
A real estate operator, Mr. Chudi Okonkwo, has projected that real estate development will increase substantially by this 2023. Okonkwo who was analysing the indices around businesses in Nigeria said that the way people approach real estate will make the sector to sustain despite the biting economy.
“I am aware, the economy is hard coupled with the subsidy removal without cushioning effects but the fact remains that one can manage how he eats but at the end of each day one must look for where to lay his head. This is what will make the growth sustained,”he opined.
Though the traditional risks in the sector, including high unfriendly interest rate environment, increase in the cost of building materials, and poor land acquisition policy, will remain, the FDC boss sees the sector’s contribution to GDP also increasing to 6.5 percent.
Figures released by the National Bureau of Statistics (NBS) in its third quarter 2022 GDP report paints a clear picture of both construction and real estate sectors growth trajectory in 2022. The report shows that both sectors together contributed N20 trillion to the GDP in the first three quarters of 2022, explaining that while construction services earned N12.9 trillion, real estate contributed N7 trillion to the GDP. The report shows further that construction contributed 9.5 per cent to nominal GDP in the third quarter of 2022 which is higher than the 9.26 per cent it contributed a year earlier and higher than the 7.95 per cent contributed in the second quarter of 2022.
The NBS also revealed that real estate services, in nominal terms, grew by 9.13 per cent, which is 0.50 per cent points higher than the growth rate reported for the same period in 2021, though lower by 3.68 per cent points compared to the preceding quarter.
Okonkwo noted that this growth would be sustained going into the new year, adding that high population and urbanisation growth would be other major drivers of the trajectory in both short and long terms.
