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Impact of Infrastructural Facilities on Residential Property Rental Value

Thesis · July 2021

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 CHAPTER ONE

INTRODECTION

1.1 BACKGROEND OF THE STEDY

The increasing rate of variations on rental values of residential properties among varying
residential neighborhoods in many towns and cities in Nigeria in recent time has continue to
dominate discussions within the spheres of practicing Estate Surveyors and Valuers, landlords,
investors, tenants, estate brokers, as well as policy makers on property investment and
management in Nigeria. Though different studies on housing rentals determination have been
carried out internationally, that acknowledged condition of dwelling characteristics, attributes of
residential location and neighborhood attributes as the foremost factors that causes housing rental
variations (Kiel & Zabel, 2008; Ajibola et al,2013). Most of these studies are foreign with only a
little of them done in the south west, Nigeria.
Many scholars have attempted in varying ways to define or explain the meaning and
concept of the term “infrastructure”. Notwithstanding the fact that it is not the intention of this
paper to explore or examine the myriad of definitions, the National Research Council of the United
States of America captured to a very great extent the totality of the term as referring to “both
specific functional modes highways, streets, roads and bridges; mass transit; airport and airways;
water supply and water resources; waste water management; solid waste treatment and disposal;
electric power generation and transmission; telecommunication and hazardous waste management
and the combined system these modal elements comprise. According to Okoronkwo and Ezeh
(2012) cited in Okorafor et al, (2017), infrastructures are not the things with which nature has
endowed man, but the profitable conversion of these natural resources for the advancement of the
society and benefit of man.
It is not an infrastructure. It becomes one when man technically conserves this gift and
develops it to serve as regular and functional water supply for agriculture, industries and for
domestic uses. Infrastructural decay occasioned by the neglect has bedevil most of our towns and
cities in Anambra State, Nigeria. The scenario is not perhaps totally different from what is tenable
in other states of the federation. The term infrastructure refers to all the physical, social and
economic elements needed to support the population, in addition to other municipal services which
include sewer, water supply, natural gas and electric services, schools and police stations, roads,
airports, etc. As society develops, the need to provide basic infrastructure for the wellbeing of their

1
inhabitants arises. Most of the Infrastructure are capital intensive in the procurement and perhaps
also in their maintenance, and these services are usually provided by the different levels of
government in the federation although private sector participation is now gradually becoming
noticeable due to the liberalization policy of some aspect of the national economy by the present
administration. Infrastructural development refers to the bringing into existence of the basic
amenities and services which must be in place for a particular activity or pursuit. However, no
nation can boast of significant development or an enhanced economy without providing the basic
Infrastructure for the citizens’ well-being. In Nigeria, sale prices of properties vary for different
suburbs due to their attributes. For people who live in urban areas or cities, infrastructure decisions
may be influenced by the balancing of desires and the environments.
Therefore, infrastructure is discussed as a key influence in explaining property price
dynamics effect of established infrastructure and location amenities property values. The adequacy
of infrastructure helps to determine the level of success that a country achieves in terms of coping
with population growth, reducing poverty, or improving environmental conditions (World Bank,
1994). One veritable parameter of assessment and indicator of status of any spatial, especially
urban system is the state of infrastructure. The efficiency of any form of human activity system
including an urban area largely depends on the provision of efficient infrastructural facilities and
services (Babarinde 1998). Hence the significance of infrastructure in the proper functioning of an
urban area cannot be dismissed. Apart from being a major pointer of environmental quality, urban
infrastructure is a critical socio-economic development of any urban area (Okusipe 1999). It places
an important and indispensable role in the economic, social and environmental aspect of life of an
urban setting. It has a pronounced impact on the quality of life. It is a back bone of any economy.
Industry needs it to effectively and efficiently drive their production processes. It is evident that a
myriad of factors such as the prevailing economic conditions, government legislation and policies,
availability and state of infrastructural provision come into play to influence commercial landed
property (values).
Investments in infrastructural facilities do contribute immensely to the population growth of
metropolitan cities of a nation. Good quality roads, railways, airport, educational institutions,
security of life and properties and hospitals are essential for the smooth running of the economic
sectors in a developing world. In many countries and for many years, economists, planners and
surveyors have tried to provide answers to why economic growth is faster in some regions than
others and why some cities grow faster than others. With the availability of major investments in
infrastructure of any city, there would be automatic population increase that would influence

2
massive property development. It has been argued by Ogunba (1999) and Ighalo (1986) that rural-
urban migration, rising purchasing power and demographic factors such as changes in the average
family size are contributory factors to urban growth.
Infrastructure and utilities encompass extensive collection of services and facilities which
include water, road, waste disposal, drainage, communication, primary health services, schools and
housing (Kiri, 2015). Appropriate provision and effective management of this public
infrastructures (Ayoola, Kemiki, Adeniran, & Abdulkareem, 2017). It enhanced productive and
profitable land uses in an urban area. The use of these infrastructural facilities completes less with
productive uses through better rent offers. Neighborhoods have been the focus of attention of city
planners, architects, and urban designers for a long time. It is a powerful idea and has occupied a
well-entrenched place in the minds of both the theoreticians and of practitioners for many years.
Yet a close analysis of its meaning reveals an extremely elusive concept whose substantive
characteristics ebb and flow over time.
The physical components include shelter and infrastructure/facilities while the services
components are community services such as education, health, culture, welfare, recreation and
nutrition to which the physical elements provide support ((CNN, 2008). In Nigerian urban centers,
basic infrastructure and utilities has suffered major neglect over a long period of time in the hands
of government and its agencies that are expected to provide and maintain the infrastructure
(Royuela, 2013). Availability of infrastructure is often one of the factors affecting the demand and
choice of residential property as man is a socioeconomic being seeking to dwell in residential units
that provides maximum supply of necessary facilities at affordable costs. Provision of facilities
that would enhance the living condition of residents within a neighborhood is therefore very
essential. Rental values of properties also vary from place to place depending on various factors
among which availability of facilities stand prominent. Most often, when factors affecting rental
values of residential properties are considered, the most commonly discussed factors are location,
quality of building, demand and supply rate among others are the most commonly mentioned with
little or no regard for the availability of public facilities and infrastructures. Therefore, in order to
elude the negative impacts of infrastructures in residential neighborhood, thorough planning and
appropriate density control are essential. Infrastructure such as roads, drainage and sewerage,
electricity, telecommunication networks and so on are substantial in supporting urban development
(Asoka, Thuo, & M., 2013).
These infrastructural services, however, are very costly to provide and maintain; and in
many cases, the local government or private developers were unable to provide sufficient

3
infrastructure and maintain them causing a havoc on residential neighborhoods. The infrastructure
services in most of these tenements are constrained, either as a result of collapse building
infrastructure, or inefficacies of the surface providers. High people density lead to overload of the
systems and deteriorate these services. In order to achieve the former outcome, it is important that
the planning of high density and the provision of infrastructure go hand in hand.

1.2 STATEMENT OF THE PROBLEM

The impact of infrastructural facilities in property market is very crucial. The fact remains
that property units are fixed in location, they however differ in terms of their surroundings,
neighborhood and the kind of community in which they are located. Considerable importance is
attached in today’s world to property’s facilities as it influences the use and value of the property.
Infrastructure and location have always been an important determinant of a property’s value.
Infrastructure and location may also be with the surrounding activities, and when these
relationships are negative to the economic and social well-being of the property, such a property is
said to have “Infrastructure and location obsolescence” and hence commands low rental value.
Properties can have more value by maintaining the infrastructural facilities or by provision of
adequate infrastructural facilities. There are some problems or factors that cause malfunctioning of
infrastructural facilities in residential property and thereby reduces the value of it due to: poor
planning, bad workmanship, lack of sufficiency in mechanical quality of materials chosen and used
or the use of low-quality materials, poor construction technology, poor funding for repairing of
damaged components, poor maintenance culture, nonchalant attitude of the user of such facilities.
Rental values of properties also vary from place to place depending on various factors
among which availability of facilities stand prominent. Most often, when factors affecting rental
values of residential properties are considered, the most commonly discussed factors are location,
quality of building, demand and supply rate among others are the most commonly mentioned with
little or no regard for the availability of public facilities and infrastructures. Property has no
intrinsic value when marketed. Value exits only where the property has a beneficial use that is, use
in occupation, or a potential to offer use in occupation. If occupational demand is weak, or lacking,
the rent or price that the property can command in the market is lowered. Real Estate developers
were consistently faced with the issue of making decision on the type of property to invest their
hard-earned income or highly competitive secured mortgaged funds, which were attached with
high lending rates. One of the different sectors that are begging for such investment is residential
property development. Residential property market has been the most common property market in

4
Nigeria and most active: especially in the urban area. The demand for housing is ever on a increase
as a result of rural-urban drift and short of demand at any given time and remained perennial.
The lack of and deplorable conditions of adequate infrastructural facilities have the
tendencies of hindering the attainment of physical and moral health; discourage social stability,
work efficiency, development of the individuals and generally affecting the quality of life. It’s
advisable those investors in residential: building should invest in modern design of tenement
property that will cater for both the present and the future needs. Also, those properties that have
fallen short of good design should be upgraded, so as to put a stop to its dwindling development
and most importantly its dwindling value in the property market in which these problems tend to
address (Smith, 2007).

Infrastructure is an umbrella term for many activities referred to as “social overhead

capital”, which include public utilities such as power, telecommunication, water supply, sanitation
and sewerage; and public works such as roads, dams, and drainage (World Bank, 2011).
Hirschman (2009) describes infrastructure as those services without which primary, secondary and
tertiary economic activities cannot function. In its widest sense it includes all public services,
ranging from law and order, through education and public health to transportation, communication,
power and water supply as well as agricultural facilities such as irrigation and drainage systems.
The adequacy of infrastructure helps to determine the level of success that a country
achieves in terms of coping with population growth, reducing poverty, or improving environmental
conditions (World Bank, 1994). In a report on a related development, Khan and Haupt (2006) state
that one of the benchmarks used in determining the wellbeing of the populace is to have the
minimal infrastructural services. Evidence suggests that inadequate infrastructure is an impediment
to the rate of growth in Africa, which has resulted in some African countries trailing behind other
developing countries (Foster and Briceno, 2010). This study therefore, seeks to examine impact of
infrastructural facilities with a view to determining the infrastructural facilities that greatly
influence the rental value of residential properties in Bauchi Metropolis Ibrahim Bako as a case
study area.

1.3 RESEARCH QEESTIONS

The following research questions will be investigated by this work:
i. What are the infrastructural facilities available in Ibrahim Bako Housing Estate?
ii. What are the conditions of the Infrastructural facilities in Ibrahim Bako Housing
Estate?
5
 iii. What level of satisfaction of tenants with the infrastructural facilities in Ibrahim Bako
Housing Estate?
iv. What annual rent paid by tenants in residential property in Ibrahim Bako Housing
Estate?
1.4 AIM AND OBJECTIVES OF THE STEDY
The aim of this study is to ascertain the impact of infrastructural facilities on residential
property rental values in Bauchi metropolis. To achieve this, the following objectives shall be
used:
i. To identify the infrastructural facilities available in Ibrahim Bako Housing Estate.
ii. To identify the conditions of the Infrastructural facilities in Ibrahim Bako Housing
Estate.
iii. To examine the level of satisfaction of tenants with the infrastructural facilities in
Ibrahim Bako Housing Estate.
iv. To examine the annual rent paid by tenants in residential property in Ibrahim Bako
Housing Estate.

1.5 SIGNIFICANCE OF THE STEDY

The essence of investing in real estate development whether for owner-occupier or
investment purposes is the expected optimum returns which could be economic, social status,
prestige e.t.c. it was discovered that of all the property types, residential property is playing a very
significant role in providing housing which is more than mere shelter for mankind. This work
therefore seeks to examine the Impact of Infrastructural Facilities on Residential Properties Rental
Value, its resultant effect on its value and proffers solution to correct both the current and future
anomalies in infrastructural facilities value. Property Market is very dynamic and complex sector
which transverse a vast array of components, institutions, socio-economic and historic dimensions.

In addition to the above, the study will be a reference material for students, scholars and
other researchers. In addition, this study will create awareness to individuals, professionals,
investors, communities and the society at large on how selected infrastructure determines
residential property rental values. Aside the contributions made to knowledge, the research would
go a long way in making possible mass evaluation of properties, help guide property investors on
areas of potential returns on investments. The research would also be significant to government on
the type of infrastructures to be provided in some certain areas. The study will guide investors on

6
where to invest taking into consideration unavailable infrastructural facilities. For this reason, it
will be significant to the following group.

This research is beneficial to the property owners and residents in the study area by
providing adequate information on availability and state of infrastructure, also this study will be
useful in providing regulatory guideline for infrastructure reform and it will assist providers of
infrastructures in planning and budgeting resources and allocations to areas where it is most
needed.

1.6 SCOPE OF THE STEDY

This project is aimed at assessing the Impact of infrastructural facilities on residential
building or properties rental value. It will be too broad and unrealistic to have covered the whole
area of Bauchi Metropolis. However, for the purpose of achieving the essence of this research, this
project is limited to residential property within the scope of the study area.

1.7 OPERATIONAL DEFINITION OF TERMS

Property: A property as conceived from layman point of view means what a man owns, his asset
and what depicts his socio-economic status or worth. From Estate Management profession
viewpoint, it is a landed property or real estate under a single ownership. It also denotes the
characteristics and quality of rights which owners possess in a limit of land (Olusola Oyebanji,
2007).

Value: This is the amount of money which can be obtained for an interest in landed property at a
particular time from persons able and willing to purchase it (Kunle Onisade & Sunday Olajide,
2007).

Property Value: This is described as the amount of money obtainable from a person or persons
willing and able to purchase a property when it is offered for sale by a willing and able seller.

Rental Value: This is the open market rent paid or payable from year to year in respect of
tenements or has established by analysis or comparison of the general level of rents actually paid
for that class of tenements in the area of locality arranged at arm’s length.

Infrastructure: This refers to the technical structures that support a society such as roads, bridges,
water supply, sewers, electrical grids, telecommunication and so forth and can be defined as the
physical components of interrelated systems providing commodities and services essential to
enable, sustain and enhance societal living condition.
7
 CHAPTER TWO

REVIEW OF RELATED LITERATERE

2.0 INTRODECTION
This chapter reviews related literature on the subject of the study. Accordingly, the chapter
is divided into eight parts. The first part presents factors affecting development of infrastructure in
Nigeria. The second and third parts touches on issues related to rental analysis of residential
properties and relevance of infrastructural development to property while the fourth and fifth parts
deals with concept of real property and urban infrastructure and growth. In the same vein, the sixth
and seventh sections dwelled on the effects of change in use on property rental value and
infrastructural facilities in the determination of rental values of residential properties and last part
presents infrastructural facilities and the rental values of residential properties

2.1 FACTORS AFFECTING DEVELOPMENT OF INFRASTRECTERE IN NIGERIA

Infrastructure contributes to economic development by increasing productivity and
providing amenities which enhance the quality of life. The services generated as a result of an
adequate infrastructure base will translate to an increase in aggregate output. Infrastructure
development has in recent times assumed a central importance in Nigeria’s fight to attain social
and economic stability. The federal government and all state governments are using infrastructure
as the focal point of their administrations and policy enactments. Infrastructure generally has to do
with the fixed provision of tangible assets on which other intangibles can be built on.
Not limited in scope, it revolves the provision of Housing, Power (electricity), Transport,
Education, Communication, and Technology. Infrastructure is the basic physical and
organizational structures needed for the operation of a society like industries, buildings, roads,
bridges, health services, governance and so on. It is the enterprise or the products, services and
facilities necessary for an economy to function. Infrastructure can be described generally as the set
of interconnected structural elements that provide framework supporting an entire structure of
development. It is the means of achieving an objective or set of objectives and also includes the
objectives. It is an important term for judging a country, region or state’s and individual’s
developments/status. The term typically refers to the technical structures that support a society,
such as roads, water supply, sewers, electrical national grids, telecommunications, and so forth,

8
and can be defined as "the physical components of interrelated systems providing commodities and
services essential to enable, sustain, or enhance societal living conditions".
Viewed functionally, infrastructure facilitates the production of goods and services, and
also the distribution of finished products to end-users (markets), as well as basic social services
such as schools and hospitals; for example, roads enable the transport of raw materials to a factory.
In military parlance, the term refers to the buildings and permanent installations necessary for the
support, redeployment, and operation of military forces. The word infrastructure, originally mean
"The installations that form the basis for any operation or system". Infrastructure in developing
countries connotes roads and transport infrastructures. The advent of telecommunication
infrastructure in Nigeria brought infrastructure to the front seat as the products and services
necessary for the performance of an entity. There are two types of infrastructure, “Hard and Soft"
infrastructure. Hard refers to the large physical networks necessary for the functioning of a modern
to all the institutions which are required to maintain the economic, health, and cultural and social
standards of a country, such as the financial system, the education system, the health system, the
governance system, and judiciary system, as well as security. Nigeria has one of the most
promising pipelines of infrastructure private Partnership Projects (PPP) in Africa. With a rapidly
growing population, the need to develop the country’s infrastructure is paramount to allow the
economy to continue to develop unchecked.
Accordingly, Nigeria is the focus of a great deal of attention from the international
infrastructure sector currently, as a result of its infrastructure gap and the commitment of Federal
and State governments to fill this gap. Unreliability of power infrastructure has no doubt been a
factor in sluggish development in certain parts of the economy, particular in process plant related
industries. However, as a number of newly-financed independent power producers (IPPs) come on
line in the next few years, assisted by Nigeria’s power privatization initiative, the increasing
stability of power infrastructure and increased exposure of international and local investors, as well
as development finance institutions (DFIs) and export credit agencies (ECAs), to the Nigerian
market should assist the process of developing Nigeria’s anticipated pipeline of infrastructure
projects. Lack of adequate power; roads and similar infrastructure will continue to hamper
economic development in the country.
The factors affecting the infrastructure development in Nigeria are:
a) Dearth of Visionary Leaders: Visionary leaders are the builders of a new dawn, working with
imagination, insight, and boldness. They present a challenge that calls forth the best in people
and brings them together around a shared sense of purpose. Visionary leaders are change

9
 agents. Nigeria contains few change agents and therefore lacks the needed infrastructure to
develop the nation.
b) Demand and supply: Due to poor performances of most past leaders in the area of
infrastructure provision, the agitation for infrastructure development overwhelms the provision.
With a land mass of 9,110,000 square kilometers of land and over 150,000 million people,
Nigeria has a total road network of 193,200KM. This comprise of 34,123KM federal roads,
30,500KM state roads and 129,577 KM local government roads. Unfortunately, over 70% of
the federal roads are in bad state of repair. In the area of housing, Nigeria requires about 17
million housing units and 60 trillion naira in order to meet its housing needs.
c) Pestles Analysis: The factor affecting infrastructural growth and development of Nigeria can
be discussed under PESTLES Analysis. Factor affecting infrastructural development can be:
political, economic, social, technology, legal, environmental and safety. Political environment
has to do with the political stability, policy formulation and politics of the project environment
both within and without. Economic environment deals with issues like interest rate, inflation,
currency exchange rate, price fluctuation etc. Social environment has to do with workforce
diversity including cultural difference, age difference etc. Technology environment deals with
the machineries which are used for the execution of projects. Physical environmental issues
like site topography, geology and climatology is also essential. Safety issues have to do with
health and safety and security of resources on site, that is human, material and financial. While
some countries have been able to implement individual projects to alleviate those difficulties,
Nigeria does not have common strategic targets for infrastructure development. Good
governance is crucial for ensuring the effective and efficient provision of infrastructure. This is
largely because, firstly, good governance means that resource allocations will reflect national
developmental priorities and thus respond to societal demands.
d) Development Matrix: The four requirements of any physical infrastructure projects are:
design, finance, technology and management. The appropriate designs that will ensure value
for money are not adopted. The finance is not adequate, is procured at high interest rates and
financial management is lacked by most Nigerian contractors. The technology of construction
is scarce and the management of infrastructure is lacking. The maintenance culture of
Nigerians is poor thereby allowing most projects to decay.
e) Capital Flight, Capital Sink and Capital Stagnancy: Infrastructure development projects in
Nigeria suffer from capital flight, capital sink and capital stagnancy. A lot of materials and
managerial services are procured outside the country. The contracts are full of loop-holes that

10
 allow leakages of funds. In some cases, there are over-design for the designers to earn more
professional fees which are percentage of the contract sum. Capital stagnancy due to
abandoned projects are also rampant.
f) Procurement Method: The procurement methods being adopted are prone to criticisms. The
Public Finance Initiatives, especially the Concession Method and Public/Private Partnership
(PPP) are questionable and seems to mortgage others who are not part of the arrangement to
the scheme’s future. The 105-kilometre Lagos-Ibadan Expressway which, under the PPP
scheme, the federal government did concession to Bi-Courtney Consortium in 2009 for N89.53
billion for 25 years is not the best arrangement possible and has not change the situation of the
road.
g) Corruption: Corruption does not only raise the price of infrastructure, it can also reduce the
quality of, and economic returns from, infrastructure investment. The corruption in Nigeria is
very high and unbearable for effective infrastructural development. The Bureau of Public
Procurement (BPP), the Independent Corrupt Practices Commission (ICPC) and Economic and
Financial Crimes Commission (EFCC) have not been able to eradicate corruption in the
country. The BPP has saved the country a whopping sum of N216.6 billion during the 2010
Appropriation year from its review of contract processes before the issuance of Certificate of
No Objection.

2.2 RENTAL ANALYSIS OF RESIDENTIAL PROPERTIES

The real estate market is a highly complex and challenging one to understand, and housing
is a multidimensional good differentiated into a bundle of attributes that vary in both quantity and
quality (Marco, 2008). The provision of public housing in Nigeria has not been able to meet the
demand for housing. It is well established that almost 90% of the nation’s housing stock is
provided by the formal and informal private sector (FGN, 2002; UNHABITAT, 2006; Olatubara,
2007). This shows the level of non-commitment of the government and government-owned
institutions toward housing provision in the country (Asaju and Olanrewaju, 2002). Institutions
admit students without making available adequate housing to accommodate them. This can greatly
influence the rent passing on residential properties in proximity to higher institutions as majority of
the students move outside the campus to search for accommodations. Residential property rental
values have been discovered to depend on various factors. However, it is often difficult to identify
the appropriate variables that will explain residential sale and rental values. Sirmans and Benjamin
(1991) while carrying out a survey on rent determinants classified them into three categories.

11
 These are: property specific attributes (including location and socio-economic factors),
management specific factors (rental concessions, property management and length of residency)
and finally, vacancies. Studies by Gunterman and Norbin (1987), Jud and Winkler (1991) show
that property specific factors affect rent significantly and positively. According to Robert (1996),
rent varies with the quality of housing. Oduwaye (2004) revealed that access to good roads,
drainages, electricity among others increase property values. Many factors interplay to create
property value, this could be economic, institutional, environmental and infrastructural factors
(Bello and Bello, 2006). Olujimi (2010) opined that infrastructural facilities are likely factors that
may affect rental value of residential properties in Nigeria since they are regarded as booster to the
social well-being of the city dwellers. Whereas Ibrahim (2011) revealed that the presence of
facilities in a building cause high preference, keen competition for properties and thus, high rental
values, while the absence of facilities results in low patronage, disincentive to people, attraction of
poor tenants and consequently, low rental values.
However, the importance of accommodation type and location to the success of a
residential property cannot be overemphasized. According to William and Berry (1980), a
prospective occupier considers the nature and extent of the accommodation offered in terms of
number and arrangement of bedrooms for convenience in use, water supply, electricity and the
condition of repairs of all parts of the building. In respect of the situation, the prospective occupier
will consider the property in general amenities of life, proximity to employment center, school and
recreational facilities. But, this scenario occurs when there are enough options from which a would
be occupier can choose from. In a situation where demand is in excess of supply, the bargaining
power shifts to the landlord, and the tenant who knows that he has little or no option will have to
pay with or without the presence of facilities. Prior to the creation of Ondo State in October, 1976,
the residential property market in Akure was dull as rental values were generally low. However,
with the creation of the State, and Akure being the state capital, residential property rental values
started to increase progressively over the years. From 1980s to early 1990s, residential properties
in the core and transitional areas of Akure metropolis accommodated the majority of people living
in Akure metropolis. It was also observed that tenants still enjoyed monthly payment of rents till
early 1990s. The common types of residential properties then were tenement buildings and flats.
The average rental value of a three-bedroom flat and a room in the late 1980s and early 1990s was
₦120 and ₦20 per month respectively.

12
2.2.1 Rental Value
There is a close relationship between rent and value. Rent can be defined as the sum
payable by a tenant to his landlord for the use of his property, usually annually (Olusegun, 2003).
Olusegun (2003) stated that the rental value of a property is the amount that a prospective tenant
can afford to pay for its occupation. In the case of residential properties, occupation is a need and
does not usually serve a profit-making function; the rental value of such a property will be
determined by the level of demand and supply. Millington (1997) defines rental value as the
maximum rent which a property can reasonably be expected to let in an open market. He went
further to state that the rental value of a property can be fixed at a particular time assuming the
following conditions exist, a willing and able buyer; the property will be freely exposed to the
market; value will remain static throughout the period of negotiation and a reasonable time period
within which to negotiate the rent taking into consideration nature of the property and state of the
market.

2.3 RELEVANCE OF INFRASTRECTERAL DEVELOPMENT TO PROPERTY

Ratcliffle (1995) in his classical rent theory conceptualizes that general improvement in
access routes (roads) haspositive effect on land and property values. The provisions of
infrastructure in any social economic unit whether a nation, a region or community could either
have a positive or negative effect on property. For example, the provision of incinerators on
residential districts will have a negative effect on the value of properties within that area while the
provision of infrastructure like good road network, water, electricity, good drainage system etc.
will have positive effects on the value of properties.
Boyce and Allen (1974) study the impact of accessibility and amenities on the value of
properties. The selected study areas then applied six criteria encompassing accessibility, amenities
and property characteristics, and used regression analysis to investigate twenty-four thousand and
eighty-two property transactions. They identified a positive impact of value on property as a result
of the infrastructure. According to Kockelman (1997), household’s location decision depends, to a
large degree, on access to opportunity sites.
With regards to budget, time, and other constraints, it is a common assumption that
households maximize their utility by locating in as desirable a home as possible as near to
necessary and desired activities such as work as possible. This utility maximization is dependent
on environmental attributes than those that can be observed and quantified. Carey (2001) asserts
that many researchers agree that the net effects associated with road transportation development

13
are not directly comparable from one region to another. To this end, generalizing among various
locales may not be appropriate. This may be the reason why Saathoff et al., (2002) state that the
effects of transportation improvements on property value have been comprehensively studied but
are still not well understood.

2.4 CONCEPT OF REAL PROPERTY

Kalu (2000) asserted that Property has several connotations but is most frequently used
with reference to real property. It is a term which English legal system has classified into two
broad terms namely reality and chattels. While other possession such as cars, households, etc. have
been classified as chattels. Land, buildings and appurtenances have been classified as reality or
property. The dynamics of development and technology has added another class to the two above.
The intellectual property has become so much of interest that a set of laws have been enacted to
protect it. The intellectual property as the name suggests include those abstract interests possessed
by a man but have been made available through documentation or invention. It includes published
materials, patents, work of arts etc. According to Barlowe (1986) property is a complicated legal
concept. It can be viewed as an object of possession. People also refer to their belongings
including landed property as their property. Lean and Goodall (1977), is of the view that property
include the concepts of right which can be held separately. From the above definitions, property
does not only mean the object owned but it includes the bundles of rights and interest encompassed
on land.
2.4.1 Categorization Of Erban Infrastructure
Nubi (2002) describes infrastructure as the aggregates of all facilities that allow a city to
function effectively. It is also seen as a wide range of economic and social facilities that help in
creating an enabling environment for economic growth and quality of life. Neil (2004) also was of
the opinion that infrastructure services have a bearing on economic growth. She explained further
that adequate infrastructure reduces the cost of production which in turn affects the profitability
level of output and employment, particularly in any small-scale business. Similarly Jerome (2006)
shared the same view by stating that infrastructure refers to all basic inputs and requirements for
the proper functioning of the economy. Infrastructure is simply the engine that is needed for proper
functioning of a city. It can be put in place by private or public involvement with the aim of
facilitating the effective functioning of the society. Obuteru (2005) identified two categories of
infrastructure namely physical and social infrastructure.

14
2.5 ERBAN INFRASTRECTERE AND GROWTH
The concentration of industries in urban centres has promoted growth within cities. The
industrial development has also contributed to diversified industrial structure which results to
expansion in cities. The existence of industries in any urban centre will create employment
opportunities thus making people to migrate from rural to such urban settings for employment
opportunities. Urban areas are able to induce economic activities because they enjoy an advantage
in the supply factors of production especially labour. With this, the market becomes broader as the
supply of real property resources, more sub-division of function occurs and economics of scale
emerges in the provision of basic public utilities and services.
With the increase in supply of real property, more demand will be made on residential
properties and the higher the demand for accommodation, the higher the property value. Olujimi
and Bello (2009) noted that the increasing demand for residential property in our urban centres
would continue to attract the real estate investors because of continuing property rent increases.
This is supported by land economy theory which suggests that the balance of demand and supply is
at equilibrium if for every new household exercising effective demand, there is an available house
either for letting or purchase at a price that permits demand to stabilize supply. It should therefore
be expected that when the demand for housing increases, the price or rent for such houses goes up
and ultimately this encourages investors to undertake new developments. In line with this, cities
develop as a result of the economic functions which necessitate the gathering of people and
activities in any given area. The lifestyle in the urban area changes from an agrarian society to
modern industrial economy. This isdue to development in transport facilities, expansion of
interregional commerce and the increased significance of service activities.
Infrastructure like good road network, energy, water, hospitals, and educational facilities
are drivers of economic growth. The quality of infrastructure available within any city has become
increasingly important in attracting new investments. There is an ineffective administration
structure to cater for the maintenance of our infrastructures at the urban centers, however, such
problems could have been easily solved if other stake holders like private individuals, community-
based organizations (CBO) and non-governmental organizations (NGO), apart from the
government participate in the provision and management of urban infrastructure. It has thus
become apparent that the provision and management of urban infrastructure cannot be left solely to
government hence private sector participation is important.

15
2.6 EFFECTS OF CHANGE IN ESE ON PROPERTY RENTAL VALEE
The rapid pace of urbanization in some developing countries (like Nigeria) has brought
about tremendous changes in the use of land (Ifeoluwa, 2011; Olayinka, 2012) of which the
metropolitan city of Abeokuta is not left out. The recent noticeable growth and development in
population and the utilization of special extent (Shankar and Vidhya, 2013) has made indelible
contributory effect on land use conversion, property values (Adebayo, 2009) and environmental
qualities (Dami et al, 2011). However, studies have shown that, the increased rate of urbanization
in the developing countries is also strengthened by the activities of the multinationals that tend to
concentrate their investments and manufacturing projects within urban areas (Olayinka, 2012).
Urbanization itself especially that which is characterized with uncontrollable population
growth produces both pretty and ugly faces (Egunjobi, 2004). The pretty face which it provides
includes concentration and complementarily of various economic activities enjoyable by the urban
populace coupled with high degree of opportunities such as employment, high demand for goods
and services, investment potentials and proximity to the various means of satisfying human wants
all of which had made the city a center of attraction and served as pulling force in attracting
increasing population from within and outside the urban area. However the ugly face which consist
of overpopulation, pressure on exiting infrastructural facilities, high crime rate, emergence of slum
area, environmental pollution as well as deteriorating of the natural ecosystem (Oyinloye and
Kufoniyi, 2013). Change in use has been described as the use of land or buildings thereon for a
purpose which is different from that for which the land or building was originally zoned and
intended for. Equally, change of use is synonymous with increase in the intensity of use, triggered
by an increase in demand (Olayinka, 2012). Thus, in any case, change in use arises as a result of
man’s attempt to exploit land resources to its highest and best use. The major contributing factors
which promote the needs for enhanced use of properties includes; interplay between the force of
demand and supply, planning regulations, use complementary, infrastructural facilities,
accessibility, population size, rent, circulation network where the impacts of the resultants increase
in land uses have been attributed to traffic congestion, housing shortage, pressure on existing
infrastructural facilities, increase in rent, overpopulation, high crime rate, poor road network etc.
(Yuri, 2005; Ayotaminu et al, 2010; Balogun et al, 2011; Gbadamosi and Ibrahim, 2013).
The goal of land use change analysis according to Kates, Turner and Clark, (1990),
revolves around two central and interrelated issues, the drivers and the impacts of the land use
changes. The drivers of the change are the causes and processes that bring about the change while
the impacts are the consequences of the change. In general, the study of the impact of land use

16
change has received more attention and publicity than the drivers simply because it is the impacts
that are readily felt. In most cases, the drivers are hardly appreciated (Dani et al, 2011). However,
land use change over time is an inevitable phenomenon occurring globally. The phenomenon could
be revealed either in a small or large scale but the most interesting and fundamental observation is
that change occurs over time in a particular place (De-Sherbinin, 2002). However, it is no longer
news that, the intensity of land use activities has become increasingly compounded with
uncontrollable growth (Eludoyin et al, 2011) most especially cities undergoing persistent
population growth (Shankar and Vidhya, 2013). This has led to the wave of land use conversion of
structures from their original plans which have become evident in most cities to the extent that a
piece of land or buildings serve many different uses from that for which they were designed or
different purposes at the same time.
This situation arises because, cities in most developing countries like Nigeria have been
undergoing unprecedented changes both in population and spatial extent (Adeboyejo and Abolade,
2006). Land use change occurs when the use to which a piece of land is currently is different from
that usage it was committed to in the past (Oyinloye and Kufoniyi, 2013). That is, change of use, is
the use of land or buildings thereon for a purpose which is different from that for which the land or
building was originally zoned and intended for. It has been globally recognized that, persistent
increase in population tends to be the most significant explanatory factor among others resulting
into urbanization characterized by with higher number of people concentrating in a particular place
usually urban centers in search of greener pastures. This assertion is supported by USGS fact sheet
188-99 in 1999 which identified that, approximately 15% of the world populations were living in
urban areas at about 100 years ago, whereas today the percentage of the world population living in
the urban centers is now nearly 50% (Eludoyin et al, 2011). However, it is a prima facie fact that,
land forms the bedrock for all human activities and development which is always dangling within
the varying man’s needs and decisions. With the needs to meet up with the current economic
realities, change in the use of land became inevitable in an attempt to achieving socio-economic
satisfaction and in order to exploit prevailing opportunities availed by land use dynamism.
Nevertheless, it is of great importance to take note of the adverse effects poised by land use
dynamism not only on the subject property itself, but also on both the adjoining land uses/structure
(Ayotamuno et al, 2010) and environmental qualities (Kevin, 2013) at large.
Therefore, changes in land uses that are attributable to human population explosion
emanates into uncontrollable intense use of land which has in turn brought about imbalance in
socio-economic human activities and poised a big threat to natural ecosystem (Eludoyin et al,

17
2011). The major challenges faced by the major cities experiencing high intensity of change in
land use structures as highlighted by Oyinloye and Kufoniyi (2013), include; uncoordinated land
development, unparalleled city growth, conflicting landuses, high densities in certain parts of the
urban area and the absence of adequate road network to enhance the ease of movement of people
within the city. In most cases, this situation has led to a degenerated standard of living in the urban
centers to the extent of incapacitating the planning authorities in dealing with the situation and
controlling urban growth (Oyinloye and Kufoniyi, 2013). Thus, in order to enhance environmental
qualities and social economic well-being of the urban dwelling places, a proper check should be
put in place (Adeboyejo and Abolade, 2006). In absence of which the beauty faces of the cities
such as the natural landscape, road network system and most importantly, housing stock will be
exposed to a great risk. (Eludoyin et al, 2011). Kin (2010), had argued that, land use regulation
promote economic well-being of a nation. But alternatively, it raise barrier to development and
thus, slow the pace of economic growth or progress (Krabben and Bokena, 1994). However, many
authors has canvassed that, the prevalent government intervention in land use was typically based
on the notion that, proper land use controls actually enhance public interest, by eliminating
negative externalities among conflicting land uses, protecting natural environments and
consequently promoting the location-specific amenities, providing adequate amount of public
goods and services more efficiently, reducing uncertainty and transaction costs involved in the
land development processes. On the other side of the argument, recent studies have also shown
that, there are undesirable consequences of strict land use regulations, such as the enhancement of
monopoly power of the land owners, the rapid increases in land or house price due to limited
supply and consequent affordable housing problems. Furthermore, in recent years, it has been
suggested that strict regulations on land use might hinder economic growth by constraining land
supply for urban uses excessively, increasing the costs of housing significantly, and limiting not
only land but also labor supply for business activities. In other words, land use regulations may
have negative effects on the performance of economies that offset the benefits stemming from the
correction of the market failure.
2.6.1 Effects of Infrastructural Facilities On The Rental Values Of Residential Property
Real estate development requires huge capital investment, which is not easy to come by
particularly in most developing countries. The concern of most investors in property development
therefore, is how to maximize the returns on their investment and recoup back their money within
a shortest possible period. In Nigeria for instance, recent years have witnessed increasing rates of
inflation accompanied by high and volatile interest rates. Asaju and Bello (2009), were of the

18
opinion that some factors have affected the entire economy. Moreover, one of the most drastic
effects of this is on housing as shown by wide swings in construction activity and in the turnover
of the existing stock as well as by growing feeling that housing is out of the reach of an increasing
large number of households The effects of which can be traced to the shortcomings of the
mortgage instruments and the institutional arrangement that surround it which in an inflationary
environment have had a serious destabilizing impact on both the demand and supply.
As a result, real estate developers are consistently faced with the issue of making decisions
on the type of property to invest their income or highly competitive secured mortgage funds, which
are attached with high lending rates. Disappointedly, a walk along major streets in most Nigerian
cities reveals that significant numbers of shopping malls and shops in residential apartments on
which such money were invested are tagged with signposts of “to-let” for months without
prospective tenants making enquires Many factors are responsible for this non-patronage non-
occupation. These range from poor location factor(s), non-availability of supporting infrastructure
(like inadequate parking spaces, poor access) to the effects of the down turn in the economy among
others. The implication of this is that substantial amount of money secured with high interest rates
are being tied down without generating the desired income.
However, the reverse is the situation concerning residential property in most Nigerian
cities. Residential Property or accommodation transcends ordinary shelter and thus comprises of
the facilities and other aspects of the social environment, which links man with his remote and
immediate neighborhood. Hardly would one find residential property being vacant for couple of
weeks without prospective tenants making effective demand. The increasing demand for
residential property in our urban centers would continue to attract the investment interests of real
estate developers. This is because of the increase in rent, which is usually attached to the property.

2.7 INFRASTRECTERAL FACILITIES IN THE DETERMINATION OF RENTAL

VALEES OF RESIDENTIAL PROPERTIES
Nigeria with 5.3 percent growth rate has a population of 140 million and it is one of the countries
with the fastest rate of urbanization in the world. One of the greatest challenges of successive
governments in Nigeria had been the need to provide adequate housing to its teeming population.
Submissions on appraisals of different housing programmes over the years revealed that no
significant positive effects had been achieved. Findings from recent studies of urban problems in
Nigerian cities have revealed that a significant proportion up to 34 percent (in some cities) of the
houses had no access to electricity, pipe-borne water, decent safe waste disposal systems and un-

19
connected by motorable road. Unfortunately, the level of deficiencies and the degree of
deterioration of infrastructure in Nigerian urban centers is becoming more alarming and worrisome
due to the inability of the public sector to meet up its social responsibilities to the people. The
problems of deteriorated infrastructure are particularly pronounced in the old, indigenous core
areas of the cities while the non-availability of infrastructure is peculiar to the outer spontaneous
settlements that accommodate the low-income population. This led to the prevalence of a generally
unwholesome and unhygienic environment in most Nigerian cities that pose a greater danger to the
health of the inhabitants. In addition to its health implication, Olanrewaju has earlier qualified
areas in cities with deteriorated infrastructure as poor areas that are characterized by spatial
concentration of low-income population, which are possible sources of urban crimes and violence.
The effects of infrastructural deterioration and their non-availability on the quality of lives
notwithstanding; Floyd and Allen have reiterated their importance in the local development
process. Thus, concluding that infrastructure development or the lack of it is often used as a policy
tool to encourage or discourage growth. However, this study focuses on the analysis of the effects
of infrastructure on property development.
Infrastructure is describes as the aggregate of all facilities that allow a city to function
effectively (Nubi, 2002). Kuye (2000) on the other hand posited that real property has significance
only as it effectively satisfies man’s needs and desires; and it is this man’s collective desire for real
property that give rise to value. One of the determinants of property values is infrastructural
facilities, the presence of which leads to appreciation in property value (Adebayo, 2006).
According to Hammer et al (2000), provision of good and adequate infrastructure is central to
property values. Infrastructure includes physical structures, facilities or utilities that are put in
place by private or public involvement and expenditure aimed at facilitating the effective
functioning of the society (Adebayo, 2006). They include housing, electricity, pipe-borne water,
drainage, waste disposal, roads, sewage, health, education, telecommunications and institutional
structures like police station, firefighting stations, banks and post office (Nubi, 2002). Harvey
(1993) posited that a residential property user may be prepared to pay a high value for a property
depending on his consideration for basic facilities such as accessibility, water and electricity.
Litchfiled (1974) also observed that areas with basic facilities such as access roads, good drainage,
electricity, public water supply and telephone would attract high property values. For instance,
accessibility which is a direct consequence of a good road network, in turn leads to high rental
values of locations with greatest accessibility advantages. In a situation where all properties are

20
accessible via motorable road network, such properties will enjoy high rental values conferred by
virtue of accessibility, (Aibangbee, 1997).

2.8 INFRASTRECTERAL FACILITIES AND THE RENTAL VALEES OF

RESIDENTIAL PROPERTIES
Residential properties have continued to attract the investment interest of real estate
developers. This is because of the increasing demand for residential properties in the urban centres
(Olujimi and Bello, 2009); and because of the increase in rent (value), which is usually attached to
the property (Oduwaye, 2007). Several factors exist that determine value of residential real
properties. According to Britton et al (1989), determinants of individual property value include
location, time, property interest, state of repair, accommodation details and services/facilities.
These factors affect properties thereby causing either „appreciation‟ or „depreciation‟ in its values.
Adebayo (2006) affirmed that infrastructures is one of the factors can cause property value to
appreciate and depreciation may occur in property values due to infrastructural degradation. Nubi
(2002) describes infrastructure as the aggregate of all facilities that allow a city to function
effectively. They include housing, electricity, pipe-borne water, drainage, waste disposal, roads
and sewage among others. The importance of infrastructural facilities in a residential property and
indeed human life cannot be overemphasized. According to Babarinde (1998), the efficiency of
any form of human activity system largely depends on the provision of adequate infrastructural
facilities. Studies have shown that the level of availability of infrastructure in most developing
countries is drastically low. For instance, Iremiren (2001) observed that a significant proportion up
to 34% (in some cities) of the houses had no access to electricity, water, descent and safe waste
disposal systems and unconnected by motor able roads.
Real estate investment is adjudged to be one of the viable and profitable investment
vehicles in the global investment market. This assertion is not unconnected to its investment
characteristics which included high return profile (rental/capital appreciation), diversification
benefits as well as inflation-hedging capacities (Olaleye, 2003; Olaleye, 2011; Ogunba, Abiyomi
& Dugeri, 2013; Dabara, 2015). In Africa and other similar developing economies, the real estate
sector is generally characterized by market immaturity and lack of relevant data for investment
analysis (Enamidem, & Ogunba, 2015; Dabara, Ogunba, & Araloyin, 2015), hence the presence
of foreign investments is not heavily felt in such emerging property markets, despite the fact that
empirical tests from several studies such as Odu (2011) and Akinsola (2012) revealed that such
markets possess great potential for high investment returns. Investment indirect real estate through

21
property development is generally a capital-intensive venture. Agbola & Kassim (2007) noted that
capital outlay required for such development is not easy to come by particularly in most
developing countries. Onyiuke (2002) noted that the economic situation in developing African
nations like Nigeria over the years had influenced the availability or otherwise of fund for real
estate development. According to Ajibola et al (2009), the informal sources of fund for property
development which includes equity contribution and personal savings is usually less than 10% of
the project cost; this usually is grossly inadequate for any meaningful real estate development. An
alternative to this is debt financing through loanable fund from financial institutions (Bruegeman
& Fisher, 2002).
Omirin In Ajibola et al (2009) however posited that property development through debt
financing in Nigeria has in recent time become more problematic because of high interest rates
being charged on loans, loan repayment requirement cumbersome loan requirement imposed by
lenders and inflation. Hence, inadequate finance, stringent loan condition from financial
institutions and inflationary environment has made real property development out of reach of
increasing number of households in Nigeria. Property development is therefore left in the hands of
investors and individuals who can meet up with the requirements. For investors who have access to
adequate fund and who are willing to invest in property development, their desire is to protect the
purchasing power of the capital invested. Their major concern is on how to maximize annual
return and recoup their investment within the shortest possible time. Consequent upon this, the
property developers are consistently faced with the issue of decision making as to the type of
asset(s) to invest in (Olujimi & Bello, 2009).
It has been observed that real estate, particularly residential properties have continued to
attract the investment interest of real estate developers the world over. This is because of the
increasing demand for residential properties in the urban centres (Olujimi & Bello, 2009); and
because of the upward only rent appreciation which characterized real estate investments
(Oduwaye, 2007). Residential property is not just ordinary shelter but comprises the facilities and
other aspects of the social environment, which links man with his remote and immediate
neighborhood. The importance of infrastructural facilities in a property and indeed human life
cannot be overemphasized. According to Babarinde (2008), the efficiency of any form of human
activity system largely depends on the provision of adequate infrastructural facilities. Adequate
infrastructure contributes to attainment of physical and moral health; stimulate social stability,
work efficiency and the development of the individuals. According to McNeil “when
infrastructure works, productivity and labor increases; when it does not work, economic renewal

22
can be postponed or even halted”. Studies have shown that the level of availability of infrastructure
in most developing countries is drastically low. This assertion was further reinforced by Iremiren
(2001) who found that a significant proportion of up to 34% (in some Nigerian cities) of houses
had no access to electricity, water, decent and safe waste disposal systems and are unconnected by
motor able roads. These grossly impact on the return capacity of such properties. For example, in a
recent educational tour embarked upon by one of the authors in Europe, the author observed that
some apartments in Bern, Switzerland commands a rental value of up to €5,000.00 per month (i.e
about N1,300,000.00 Naira). This is likely not unconnected with the fantastic infrastructural
facilities available in Bern. This assumption needs to be empirically tested as the same author also
observed that rental values are higher in slum areas (lacking basic infrastructural facilities) such as
yanya in Abuja Nigeria in comparison to urban centers with some basic infrastructural facilities
such as Gombe, Nigeria.

23
 CHAPTER THREE

RESEARCH METHODOLOGY

3.1 BACKGROEND OF THE STEDY AREA

Bauchi State is a state in northern Nigeria. Its capital is Bauchi. The state was formed in
1976 when former North-Eastern State was broken up. It originally included the area now in
Gombe State, which became a district state in 1996. Bauchi Metropolis, the headquarters of Bauchi
State, is located between latitudes 9” 00’ and 9” 30’ North of the Equator and longitudes 10” 25
and 11” 20’ East of the Greenwich Meridian (Gani, Chiroma & Gana, 2012). It covers a total land
area of 3,687 square kilometers (Ogwuche, 2013), and a population of 4,653,066 according to the
2006 population census (Federal Republic of Nigeria Official Gazette, May 2007, National Bureau
of Statistics, 2010 and Ogwuche, 2013). Below is the map of Bauchi, Nigeria shows by open street
where the location is placed.

Fig. 3.1 Map of Bauchi source by open street, 2016

This study is to investigate on the Impact of Infrastructural Facilities on Residential

Property Rental Value in Bauchi Metropolis Ibrahim Bako Housing Estate Bauchi, Inkil, Bauchi,
Nigeria. It’s a nice place with constructed road that link to Maiduguri road within short period of
time, constructed by Governor Bala Muhammed, Kauran Bauchi in the year 2020.
24
3.2 RESEARCH DESIGN OF THE STEDY
The study adopted the survey research method. Research design is the arrangement of
condition for collection and analysis of data in a manner that aims to combine relevance to
research purpose with economy in procedures. The field survey design approached was employed
for this study because it is amenable to situations where facts or data must be collected from
respondents through the use of questionnaires.

3.3 POPELATION OF THE STEDY

The population of the study comprises household residents’ members within the area of the
study. The sample of the target population was used to predict certain characteristics of the
population.

3.4 SAMPLE AND SAMPLING TECHNIQEES

The probability sampling method was used in this study. Residential properties were
selected from the study area through stratified random sampling techniques. Therefore, the
population from which a sample is to be drawn does not constitute homogeneous group, then
stratified sampling technique is applied so as to obtain representative sample. In this technique, the
population is stratified into a number of non-overlapping subpopulations or strata and sample items
are selected from each stratum and the items selected from each stratum is based on simple random
sampling the entire procedure, first stratification and then simple random sampling.

3.5 SOERCES OF DATA COLLECTION

Data collected for this study were from two main sources; primary sources and secondary
sources. Primary data were generated through the use of self-questionnaires designed specifically
for the study. The secondary data were obtained through the review of relevant literatures,
journals, papers and thesis. Data were collected on the types of residential property, the types and
the conditions of infrastructural facilities provided and rents paid by tenants, the tenants‟ willing to
pay more with improved facilities among others.

3.6 INSTREMENT FOR DATA COLLECTION

A total of 40 questionnaires were administered to residents in the study area. The
questionnaire used in this research contained close-ended questions and self-assessment items,

25
measured. Close-ended questions have been reported by Gorard (2001) to be preferable in
questionnaire designs. The questions were designed in such a way that it will help the researcher to
source necessary data for achieving each of the objectives of this study.

3.7 METHOD OF DATA ANALYSIS

Statistical package of social sciences (SPSS v.23) were used in analysis of the data
collected and descriptive statistical analysis was employed in forms of percentage techniques,
frequency tables for data presentation in the next chapter four.

26
 CHAPTER FOER

DATA PRESENTATION, ANALYSIS AND DISCESSIONS

This chapter present analysis and interprets the data collected for the study. Data were
collected in frequency table and percentage was used for data analysis. From a total fourthly (40)
questionnaire distributed to the respondents. Thirty-six (36) questionnaire which represents 90%
were daily completed and returned, while four (4) representing 10% copies were not returned.
Table 4.1 Distributions and Return of the questionnaire
Questionnaire Distributed Frequency (No.) Percentage (%)
Returned 36 90
Not Returned 4 10
Total 40 100
Sources: Field survey, 2021

4.1 ANALYSIS OF PERSONAL DATA

Table 4.2: Sex of the respondents

Sex Frequency (No.) Percentage (%)
Male 32 88.89
Female 4 11.11
Total 36 100
Source: Field survey, 2021

Table 4.2 shows the frequency and percentage of respondent sex 32 people (88.89%) were male
and 4 people (11.11%) were female. This indicate that male participants was more sample than
female.
Table 4.3: Age of the respondents
Age of the respondents Frequency (No.) Percentage (%)
30-35 years 6 16.67
36-40 years 12 33.33
41-45 years 15 41.67
Above 45 years 3 8.33
Total 36 100
Source: Field survey, 2021

This is the most important characteristics of the respondents. From the table 4.3, it can be seen that
the 6 people representing (16.67%) were 30-35 years of age, 12 (33.33%) were between the age of
36-40 years and 15 (41.67%) were between the age of 41-45 years of age and those above 45 years

27
are 3 which represent (8.33%). This implies that majority of the respondents were between the age
of 41-45 years.
Table 4.4: Academic Qualification
Academic Qualification Frequency (No.) Percentage (%)
SSCE/GCE 7 19.44
ND/NCE 10 27.78
HND/1st Degree 16 44.44
Masters/PHD 3 8.33
Total 36 100
Source: Field survey, 2021

The essence of asking this particular question was to make sure that the respondents are equipped
with certain minimum educational qualifications that will enable them respond correctly and
confidently to the questions. Table 4.4 shows all the respondents were educated to a reasonable
extent. This indicate that 7 people or 19.44% attained SSCE/GCE level of Education, 10 people
(27.78%) were attained ND/NCE level of Education, 16 people (44.44%) were HND/1st Degree
level of Education while 3 people (8.33%) attained Masters/Doctorate degree. This mean that
majority of the respondents are HND/1st Degree level of Education.

4.2 PRESENTATION AND ANALYSIS OF DATA ON RESEARCH QEESTION 1.

What are the infrastructural facilities available in Ibrahim Bako Housing Estate?
Table 4.5: Infrastructural Facilities Available (% in Parenthesis)
Infrastructural Facilities Available
Variables Yes No Total
Water 33 (91.7) 3 (8.3) 36 (100)
Electricity 36 (100) 0 (0.0) 36 (100)
Refuse Disposal Facility 23 (63.9) 13 (36.1) 36 (100)
Access road 28 (77.8) 8 (22.2) 36 (100)
Burglary proof 19 (52.8) 17 (47.2) 36 (100)
Drainage Channel Fence 27 (75.0) 9 (25.0) 36 (100)
Kitchen 31 (86.1) 5 (13.9) 36 (100)
Toilet 33 (91.7) 3 (8.3) 36 (100)
Watching day service 26 (72.2) 10 (27.8) 36 (100)
Watching night services 22 (61.1) 14 (38.9) 36 (100)
Source: Researcher field survey, 2021

28
Table 4.5 presented the infrastructural facilities that were available in the residential property.
These included: water supply, electricity, refuse disposal facility, access road, burglary proof,
drainage channel, wall-fence, kitchen and toilet. The levels of provision of these facilities vary
from building to building and from one area to the other. Water is based on functional water
supply from at least one of public water supply, hand-dug well or borehole. 91.7% of the sampled
residential properties in Ibrahim Bako Housing Estate were provided with functional water supply
while 100% of the sampled residential properties were connected with electricity.
Refuse disposal facility in residential properties is generally poor and only 63.9% of the
sampled residential properties in enjoyed refuse disposal services. The provision of access road to
residential property ensures easy and safe movement of goods and services. In all of the sampled
residential properties were accessible by motorable road while only 2.22% of the sampled
residential properties in the study area were accessible. Installation of burglary proof in residential
property serves as means of ensuring security of properties in such buildings. In Ibrahim Bako
Housing Estate, 52.8% of the sampled residential buildings were installed with burglary proof in
their windows. The drainages are necessary in the residential areas to convey rain water thereby
preventing flooding of the area. While 25% of the sampled residential properties in the area could
boast of functional drainage, only 75% of the sampled residential properties have functional
drainage channels. Kitchens provide safe environment for cooking within a residential building.
Out of the sampled residential properties in the study area, 100% were provided with kitchen
facility.

29
4.3 PRESENTATION AND ANALYSIS OF DATA ON RESEARCH QEESTION 2.
What are the conditions of the infrastructural facilities in Ibrahim Bako Housing Estate?
Table 4.6: Conditions of the Infrastructural Facilities (% in Parenthesis)
Conditions
Variables Good Fair Poor Total
Water 26 (72.2) 7 (19.4) 3 (8.3) 36 (100)
Electricity 36 (100) 0 (0.0) 0 (0.0) 36 (100)
Refuse Disposal Facility 23 (63.9) 11 (30.6) 2 (5.5) 36 (100)
Access road 29 (80.5) 6 (16.6) 1 (2.77) 36 (100)
Burglary proof 18 (50.0) 9 (25.0) 9 (25.0) 36 (100)
Drainage Channel Fence 22 (61.1) 8 (22.2) 6 (16.6) 36 (100)
Kitchen 32 (88.8) 4 (11.1) 0 (0.0) 36 (100)
Toilet 35 (97.2) 1 (2.77) 0 (0.0) 36 (100)
Watching day service 16 (44.4) 11 (30.6) 9 (25.0) 36 (100)
Watching night services 19 (52.7) 9 (25.0) 8 (22.2) 36 (100)
Source: Researcher field survey, 2021

Table 4.6 presented the residents perception of the condition of the existing infrastructural
facilities in the residential property which was based on three categories: good, fair and poor. The
Table showed that 72.2% of the residents in Ibrahim Bako Housing Estate indicated that water
supply to their buildings was good while only 8.3% considered water supply as being poor. The
condition of electricity supply was generally rated good and fair in the study area. This may not be
unconnected with the overall condition of electricity supply in the country in general. In the
Ibrahim Bako Housing Estate where refuse disposal facility was available, 5.5% of the residents
confirmed that the refuse disposal services were poor. Also, the conditions of installed burglary
proof, drainage channels, fence, kitchen and toilet provided in residential property in the study are
were in a better condition when compared to those indicated by responding tenants. For instance,
installed burglary proof and drainage channels were considered poor by 16.6% of the tenants
respectively.

30
4.4 PRESENTATION AND ANALYSIS OF DATA ON RESEARCH QEESTION 3.
What level of satisfaction of tenants with the infrastructural facilities in the Ibrahim Bako Housing
Estate?
Table 4.7: level of satisfaction of tenants with the infrastructural facilities (% in Parenthesis)
Levels of Satisfaction
Variables Satisfied Not satisfied Indifferent Total
Water Supply 21 (58.3) 4 (11.1) 11 (30.5) 36 (100)
Electricity 21 (58.3) 7 (19.4) 8 (22.2) 36 (100)
Refuse Disposal Facility 18 (50.0) 13 (36.1) 5 (13.8) 36 (100)
Access road 36 (100) 0 (0.0) 0 (0.0) 36 (100)
Burglary proof 12 (33.3) 19 (52.7) 5 (13.8) 36 (100)
Drainage Channel Fence 28 (77.8) 3 (8.3) 5 (13.8) 36 (100)
Kitchen 36 (100) 0 (0.0) 0 (0.0) 36 (100)
Toilet 36 (100) 0 (0.0) 0 (0.0) 36 (100)
Watching day service 12 (33.3) 15 (41.6) 9 (25.0) 36 (100)
Watching night services 19 (52.7) 14 (38.8) 3 (8.3) 36 (100)
Source: Researchers field survey, 2021

The level of satisfaction of the residents with the available infrastructure in the residential property
in Ibrahim Bako Housing Estate is assessed under three categorization viz-satisfied, not satisfied
and the last category is indifferent. The indifference is a situation where respondent is unable to
make up his/her mind as to the indicated categories. Table 4.7 shows that only 11.1% of the
residents were not satisfied with the electricity supply into their buildings. This is connected with
the frustrating condition of electricity supply in the country in general in particular. Only 58.3% of
the residents that confirm being satisfied. This is followed by water supply, for which 58.3% of the
were not satisfied with the water supply in their houses. About 36.1% of the respondents were not
satisfied with the refuse disposal services and the condition of the drainages abutting their rented
residential property. However, 52.7, 33.3 and 100% of respondents were correspondingly satisfied
with the night watch-security services, burglary proof installed and kitchen provided in their
residential property.

31
4.5 PRESENTATION AND ANALYSIS OF DATA ON RESEARCH QEESTION 4.
What annual rent paid by tenants in residential property in Ibrahim Bako Housing Estate?
Table 4.8: Annual Rent (in Naira) Paid by Tenants in Residential Property
Annual Rental Value by area
Property Types Ibrahim Bako Housing Estate
Tenement N 12,000.00 –N 25,000.00
1 Bedroom flat N 45,000.00 – N 60,000.00
2 Bedroom flat N 72,000.00 – N 100,000.00
3 Bedroom flat N 120,000.00 - N 180,000.00
Duplex N 200,000.00 –N 250,000.00
Source: Researcher field survey, 2021

Annual rental value of similar type of residential property varies in Ibrahim Bako Housing Estate.
Table 4.8 showed that rent passing on tenement residential property in the study area ranges from
N12000.00 - N25000.00 per annum while, 1-bedroom flat is between N45,000.00 and maximum
N60,000.00 and 2-bedroom flat rental value in the area are between N72,000.00 – N100,000.00.
Also, a 3-bedroom flat in area commands rent not lower than N120,000.00 whereas there is no 3
bedrooms flat in Ede that goes for over N200,000.00 per annum. This clearly suggested that rental
values of residential properties are higher.

32
 CHAPTER FIVE

SEMMARY OF FINDINGS, CONCLESION AND RECOMMENDATIONS

This chapter focuses attention on the summary and conclusions reached in this research. The
conclusions reached are discussed on the basis of analysis and interpretation of data. Based on the
result from the analysis recommendations have been constructed.
5.1 SEMMARY OF FINDINGS

This study has investigation to examine the impacts of infrastructural facilities on residential
property rental value in Bauchi Metropolis where Ibrahim Bako is a case study area, with the
reference to the study population and the data retrieved from them, the following data analysis and
results discussed in the previous section, below are the major summary findings made discussed.
Based on the study findings in terms of personal data or socio-demographic data of the respondents
reveal the majority are male in gender and their age are between 41-45 years while their level of
education mostly is HND and first degree.
The study shows that the levels of provision of these facilities vary from building to
building and from one area to the other. Water is based on functional water supply from at least
one of public water supply, hand-dug well or borehole. 91.7% of the sampled residential properties
in the study area. The study also, presented the residents perception of the condition of the existing
infrastructural facilities in the residential property which was based on three categories showed
that 72.2% of the residents in Ibrahim Bako Housing Estate indicated that water supply to their
buildings was good while only 8.3% considered water supply as being poor and the condition of
electricity supply was generally rated good and fair in the study area.
The study reveals that the level of satisfaction of the residents with the available
infrastructure in the residential property in Ibrahim Bako Housing Estate indicates that only 11.1%
of the residents were not satisfied with the electricity supply into their buildings. This is connected
with the frustrating condition of electricity supply in the country in general in particular. Only
58.3% of the residents that confirm being satisfied. This is followed by water supply, for which
58.3% of the were not satisfied with the water supply in their houses. About 36.1% of the
respondents were not satisfied with the refuse disposal services and the condition of the drainages
abutting their rented residential property, whereas there is no 3 bedrooms flat in Ede that goes for
over N200,000.00 per annum. This clearly suggested that rental values of residential properties are
higher.
33
5.2 CONCLESION

The study compared the impact of infrastructural facilities on the rental value of residential
properties in Ibrahim Bako Housing Estate, Bauchi State. The study showed that appropriate
residential infrastructural facilities enhanced the rental values of residential properties in the study
area. This was evidenced where the infrastructural facilities in the sampled residential properties
were in good condition and consequently the annual rent values were higher in some
infrastructural facilities were either unavailable or in poor condition. It is therefore recommended
that property developers should put in place appropriate infrastructural facilities in their properties
to ensure maximum returns from their property investment. In conclusion, improved quality of
infrastructural facilities contributed to the increase in the rental values of residential property in the
study area.

5.3 RECOMMENDATIONS

Based on the results of the research work the following recommendations are made:

a) Therefore, residential property developers should focus their residential property

development efforts, in order to make higher returns on their investment.
b) In view of this, the state government should establish more “Site and Service Residential
Schemes” and make them more attractive to property developers to participate in the
physical development of the schemes.
c) The tenants or residents should organize themselves under the agencies of “Landlords-
Tenants’ Association” by rendering community services in the maintenance of the roads.

34
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27th Annual Conference of the Nigeria Institution of Estate Surveyors and Valuers, at Premier
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Management: A Book of Readings, Agbola, S.B., T.O. Egunjobi and C.O. Olatubara (Eds).
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Ajibola, M. O., Oloyede, S. A. and Oni, A. O. E. (2009). Real Estate Investment Trust: An
Attractive Investment Vehicle for Real Estate Development in Nigeria. Journal of the Nigerian
institution of Estate Surveyors and Valuers 32(1), 60-73
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Services in Metropolitan Lagos. The Lagos Journal of Environmental studies 1 (1), 97-108.

Babawale, G. K. (2004). „Sustainable Urban Infrastructure Delivery in Nigeria: The role of the Private
sector and community – based organizations (CBO’s) Paper presented at the 34th Annual
Conference of the Nigeria Institution of Estate Surveyors and Valuers held at Nicon Hilton, Abuja
30th March – 4th April.

Britton, W, Davies K and Johnson, T. (1988): Modern Methods of Valuation (8th ed.) The Estate Gazette,
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Dabara, I. D., Ogunba, A. O. & Araloyin, F. M. (2015). The Diversification and Inflation-Hedging
Potentials of Direct and Indirect Real Estate Investments in Nigeria. Proceedings of the 15th African Real
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Ghana. Pg 169-185.

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property investments in Gombe, Nigeria. Advances in Research Journal. 3(1),71-83. Retrieved
from http://www.sciencedomain.org/abstract.php?iid=645&id=31&aid=6249#.VDgdp1f_afU
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Golden Tulip, Kumasi, Ghana. Pg 169-185.
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Estate Society (AFRES) Annual Conference, 31st August – 3rd September 2015, Golden Tulip,
Kumasi, Ghana. Pg 169-185.
Enamidem, U & Ogunba, A. O. (2015). Real Estate Finance & Investment: An evaluation of foreign direct
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Tulip, Kumasi, Ghana. Pg 169-185.
Hammer L; Booth D. and Love H.E (2000) Poverty and Transport; A Report prepared for the World Bank
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Iremiren, A. (2001). Impact of the Private Provision of infrastructural facilities on Housing Cost. B. Tech
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project of department of Estate Management, Federal University of Technology Akure.
Oduwaye, L. (2009). Spatial Variations of Values of Residential Land use in Lagos Metropolis. Afr. Res.
Rev. (3)381-403. http://ajol.info/index.php/afrrev/article/view/43638
Oduwaye, L. (2009). Spatial Variations of Values of Residential Land use in Lagos Metropolis. Afr. Res.
Rev. (3)381-403. http://ajol.info/index.php/afrrev/article/view/43638
Ogunba, O.A., Obiyomi, O. O. & Dugeri, T. (2013). The inflation hedging potential of commercial
property investments in Ibadan, Nigeria In: Laryea, S. and Agyepong, S. (Eds) Procs 5th West
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Olaleye, A. (2003). Property portfolio diversification strategies: A review of the options. Ife Journal of
EDM, 5, 15-32.
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Journal of Financial Management of Property and Construction. 16(3), 272-282.
Olujimi, J. A. B. and Bello, M. O. (2009) Effects of Infrastructural Facilities on the Rental Values
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37
 APPENDIX

DEPARTMENT OF ESTATE MANAGEMENT AND VALEATION

SCHHOL OF ENVIRONMENTTAL TECHNOLOGY
ABEBAKAR TATARI ALI POLYTECHNIC, BAECHI
BAECHI STATE

INTRODECTION LETTER
Dear Sir/Madam,
I am undergraduate student of the Department of Estate Management in the School of
Environmental Technology Abubakar Tatari Ali Polytechnic Bauchi (ATAP), Bauchi state and this
survey is an effort to fulfill the requirement for an award of Higher National Diploma (HND) in
estate management and valuation study.
This questionnaire is designed to obtain information necessary for completion of my
research work on the Impact of Infrastructural Facilities on Residential Property Rental Value in
Bauchi Metropolis (a Case Study of Ibrahim Bako Housing Estate)

The information sought from you is needed for academic purpose and it will be kept confidential.
Kindly co-operate by completing the attached questionnaire.
Thanks.
RESEARCHER:

Emar Ismail Emar (ESV)

Yours faithfully,

38
Instruction: Please read the following items and tick in the space against a response that
tends to express your feeling.
SECTION A (PERSONAL INFORMATION)

1. Sex: (a). Male ( ) (b). Female ( )

2. Age of the respondent: a.) 30-35 ( ), b.)36-40 ( ), c.)41-45 ( ), d.) 45-above ( )
3. Highest educational qualification: a.) SSCE/GCE,( ) b.)ND/NCE( ) c.)HND/1st Degree ( )
d.) Masters/PHD ( )
SECTION B
1. What are the infrastructural facilities available in Ibrahim Bako Housing Estate?
Infrastructural Facilities Available
Varibles Yes No
Water
Electricity
Refuse Disposal Facility
Access road
Burglary proof
Drainage Channel Fence
Kitchen
Toilet
Watching day service
Watching night services

2. What are the conditions of the infrastructural facilities in Ibrahim Bako Housing Estate?
Conditions
Variables Good Fair Poor
Water
Electricity
Refuse Disposal Facility
Access road
Burglary proof
Drainage Channel Fence
Kitchen
Toilet
39
 Watching day service
Watching night services

3. What level of satisfaction of tenants with the infrastructural facilities in the Ibrahim
Bako Housing Estate?
Levels of Satisfaction
Varibles Satisfied Not satisfied Indifferent
Water Supply
Electricity
Refuse Disposal Facility
Access road
Burglary proof
Drainage Channel Fence
Kitchen
Toilet
Watching day service
Watching night services

4. What annual rent (in Naira) paid by tenants in residential property in Ibrahim Bako
Housing Estate?
Annual Rental Value
Tenement 1 Bedroom 2 Bedroom 3 Bedroom Duplex
Annual rent (N) flat flat flat
N 12.000.00 – N 25,000.00
N 45,000.00 – N 60,000.00
N 72,000.00 – N 100,000.00
N 120,000.00 - N 180,000.00
N 200,000.00 –N 250,000.00
Above N 250,000.00

40

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