High interest rates, inflation, crippling property market – HDAN

High interest rates and inflationary pressures are currently slowing property business across the country, the Housing Development Advocacy Network (HDAN) has said.

In a statement, Barr. Festus Adebayo, the Executive Director of HDAN, says the rise in property prices is partly due to inflation and the high cost of building materials, exacerbated by the devaluation of the naira and the rising costs associated with importing construction materials.

In the light of these challenges, Adebayo noted that “It is particularly a tough time for real estate sales nationwide, with similar trends observed in other major cities like Abuja, Lagos and Port Harcourt.

“Particularly, the surge in inflation has led to a decline in consumer purchasing power, directly impacting the real estate market. Inflation has also driven up construction costs, challenging the viability of new projects and reducing the number of new developments.”

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Barr. Adebayo added that “The costs of building materials have soared, labour costs have skyrocketed, and house prices have followed suit. Even maintenance costs have risen, unsettling the rental market and squeezing renters.”

The HDAN boss recommended that “The government should either subsidise locally sourced building materials or reduce the cost of importing them to make housing more affordable.”

He noted that without significant intervention and innovation, the dream of affordable housing may remain elusive for many Nigerians, adding that developers, investors, and government agencies alike must work together to navigate these tough times and secure a sustainable future for the real estate market in the country.