MODELLING THE DYNAMIC EFFECTS OF INTERACTION BETWEEN URBAN INFRASTRUCTURE CONDITIONS AND RESIDENTIAL PROPERTY INVESTMENT RETURNS IN ABUJA, NIGERIA

Abstract

Purpose: The study examines the relationship between infrastructure condition and residential property investment in Abuja, Nigeria. It was carried out with specific focus on the effect infrastructure conditions impacts on property investment returns in the selected residential submarkets of Abuja. Design/methodology/approach: A survey approach was adopted with residential properties currently in the market generating income (rental or capital values) for investors as the study samples. Firms of Estate Surveying and Valuation and households were also used for data collection. Transactions of 718 were obtained from 1, 2, 3 and 4 bedrooms properties as well as availability and condition of infrastructure. Correlation coefficient and regression model were used to examine the relationship and effect of infrastructure condition on residential property investment returns between 2009-2018. Findings: The results from analysis revealed a significant and positive relationship between infrastructure conditions and rate of returns. This has also shown that the functional condition of infrastructure in Abuja has a significant effect on the rate of returns on residential property investment hence a good market performance. Research limitation/implications: In examining the level of infrastructure condition on rate of returns on residential properties, an assessment of some basic infrastructure type such; water supply, electricity, access roads, streetlights, drainage system, waste management, health, recreation, education, and security within the selected locations in Abuja were used. The rate of returns were measure from 2009 to 2018. Originality/value: The conclusion from the result is that infrastructure condition contributesto about 71% of the rate of returns on residential property and hence, a positive determinant of market performance.

Keywords: infrastructure condition, property investment, returns, neighbourhood, rental trends