In a developing economy like Nigeria, national elections have a significant impact on the performance of all sectors of the economy, including the real estate market.
As the 2023 general election approaches, potential real estate investors are debating the best time to make real estate investments: before or after the election.
Real estate industry participants are eager and excited to learn of the verdict due to the potential impact it could have on the market.
In a developing economy like Nigeria, national elections have a significant impact on the performance of all sectors of the economy, including the real estate market.
The administration currently in power contributes to an environment fraught with uncertainty, which in turn hinders the growth of the economy.
Infrastructure projects are especially vulnerable because their results are uncertain if there is a change in the administration of the center. This has an indirect influence on the real estate landscape in cities across the country.
Industry analysts anticipate a successful run in the General Election as the real estate market has finally adjusted to the effects of the Covid-19 pandemic.
With house prices likely to drop during election season, now is a great time to invest in real estate because this will help fuel growth in the sector.
General consumer confidence during election periods
It has been observed that potential investors adopt a wait-and-see strategy in anticipation of additional standard operating procedures from the administration that will be elected or re-elected after the next general election.
It has been observed that investors refrain from investing in the real estate market during the upcoming general elections. In general, investors expect new rules, plans, and offers that could be beneficial to real estate investments or could be detrimental to those investments.
This affects not only investors, but also everyone else. Even developers face a very similar situation to the one described, and most of them would rather focus on liquidating existing inventory than launching new initiatives.
This is because developers may experience delays in receiving regulatory permits for newly announced projects during election season.
As a result, this situation has occurred. The drop in home values ​​that occurs during this time is usually followed by a rebound in a few quarters.
If you buy a house in a year with an upcoming election?
Every four years, general elections are held in Nigeria and a significant amount of money is spent on promotions and other election-related logistics.
During this period, it is common for those interested in real estate to sell their assets and withdraw any money that may have been sitting there. Consequently, there is a shortage of liquidity in the market, leaving property developers strapped for cash.
It has also been brought to the public’s attention that certain properties are being sold for less than their fair market value in order to raise money for election campaigns. Also, builders restrict the number of new releases and focus entirely on depleting the stock they already have.
Prospective homeowners should always be on the lookout for instances where they can cut costs by buying a home on the secondary market, also known as the resale market.
They should also make every effort to negotiate with the builder in order to come to an agreement with them directly.
Homebuyers have the opportunity to engage in vigorous negotiations and obtain significant price reductions on the property they are interested in purchasing because most real estate developers focus on selling their unsold inventory.
As a result of the 2023 general election, the Nigerian economy is expected to go through a series of transitions; however, only time will tell if the real estate market will change or not.
