The Effects Of Infrastructural Facilities

The Effects Of Infrastructural Facilities Infrastructure are the basic facilities, services, and installations needed for the functioning of a community or society, such as transportation and communications systems, water and power lines, and public institutions including schools, post offices, and prisons. Large infrastructure projects generally stimulate demand for nearby real estate .these infrastructural projects usually create abundance of jobs as well as follow on demand for goods and services. They also provide a more effective use and connectivity of the available economic resources and the resulting increase in economy activity from new and more disposable income will in turn typically boost. Economic growth, thats why people will want to purchase or rent residential estate in location within close proximity to major works, Major infrastructure project can take many forms and often include transport, infrastructure improvement such as link roads, railway line extension, new bridges and major freeways. Other projects could be new shopping malls and commercial precincts, new power stations, improve communication facilities industrial areas and business parks, new hospital, school and universities. These can all have an impact property values and demand for residential properties. It is also worthy to note that the quality and quantity of infrastructure available in a given place societies is the yardstick for measuring the general level of development of that area and a major determinants of property development and their respective value trends. The provision or not of these facilities can positively development affect the rate of property development in a given area and this in turn can improve the property value due to the corresponding boost on economics activities achieved through the better accessibility (road) or the higher degree of convenience from the use of these infrastructural facilities. 1.2 Statement of Problem The infrastructure of a city is a major determinant on the demand of houses. One of the major problems affecting housing demand in Lokoja. The poor infrastructure provision in the study area affects the rate of housing Demand in the area, this is because people will only buy or rent houses in areas were the infrastructure provision is sustainably available,this will help to enhance the livability in the community. The poor infrastructure provision in Adankolo is a major determinant on the decrease in the rate of housing demands in the study area. Those who are living in the study area have no choice because they cannot afford the rent in other livable towns . Housing is an enclosed component or structure that has services which support the comfort and existence of human living. These services or facilities are numerous some of which include; kitchen, toilet, refuse disposals, good road networks, electricity, telecommunication and others. Ogedengbe and Oyedele, (2006) carried a research on effects of waste disposal on property values, similarly Robet in his work The Effects of Road Infrastructure on Property Values emphasized more on just road as a facility affecting demandvalues, Whereas many other facilities affect values of residential properties. This now poses a gap between these previous empirical studies hence there is need to reconsider many other facilities as they affect housing demand and housing demand of residential properties. 1.3 Aim and Objectives The aim of this study is to ascertain the effects of infrastructural facilities on housing demand in Lokoja metropolis. OBJECTIVES To identify the various infrastructure available in the study area. To examine the adequacy of infrastructural facilities provision on the residential properties in the study area To recommend possible solution to the problems of housing in the study area. 1.4 Scope of the study This research work intends to determine the effects of infrastructural facilities on housing demand in Lokoja. It is limited to Lokoja metropolis alone with particular emphasis on two areas namely; peace community ganaja village and Adankolo for comparative analysis. 1.5 Justification Although challenges surrounding life and human wants are limited and endless, however these study focuses on the effects of infrastructural facilities on housing demand in Lokoja. And this particular studywill serve as a guide to the following. Urban and regional planners and other allied professionals such as builders, architect, engineers, and others in their various field of activities .for example, these study would give the city managers the ideas of important of infrastructural facilities in there different areas. It serves as a tool to all researchers in the field particularly in the study area.(Lokoja) 1.6 The Study Area Lokoja, Nigeria is located at 7.80236 [latitude in decimal degrees], 6.743 [longitude in decimal degrees] at an elevation/altitude of meters. The average elevation of Lokoja, Nigeria is 55 meters.Lokoja is also a Local Government Area of Kogi State with an area of 3180 km ² and a population of 195,261 at the 2006 census. It is bounded by the Niger in the north and east upstream from the capital until the border with Kwara State, and includes the city of Lokoja. The postal code of the area is 260.The original site of Lokoja, is a 1,349-foot- (411-metre-) high mass of oolitic iron ore. The town has a hydroelectric power generating plant. It is situated on the local highway between Kabba and Ayangbe and has ferry service across the Niger River. Formerly the capital of Kabba province, Lokoja was part of Kwara from 1967 to 1991, when it became the capital of the newly formed state of Kogi. CLIMATE Climate: The site has a tropical climate that comprises of two season namely dry and wet seasons. The wet seasons starts from the month of April and ends in October, while the dry season starts from November and continues till March. The two seasons are affected by the south-westerly winds coming from the Atlantic Ocean and north-easterly winds which come from the Sahara Desert. Another weather phenomenon (micro climate) is associated with the presence of inselbergs. This feature exerts an influence on local weather greater than their size. Rainfall: Rainfall data obtained from the Department of Meteorological Services Lokoja for 25 years (1989- 2005) reveals that the maximum daily rainfall figures of Lokoja town are as follows: Humidity and Temperature: The highest temperatures in the study area always tend to occur at the end of the dry season close to the spring equinox. Thus March has the highest temperature of about 34.5 c, while the lowest temperature occur in the middle of the dry season in December/January, when outgoing radiation is encouraged by low humidity, clear skies and longer nights. The temperature at this time falls as low as 22.8 c. In the dry season there is a decrease in relative humidity from south to north in the study area caused by the higher elevation in the north. In the rainy season, this variation disappears and associated with the high relative humidity is an extensive cloud cover over the region. ECONOMY Agriculture is main stay in Lokoja area economy, various crops are widely grown in the area which includes; coffee, cocoa, palm oil, cashews, groundnuts, maize, cassava, yam, rice and melon.The state is home to the largest iron and steel industry in Nigeria known as Ajaokuta Steel Company Limited. One of the largest cement factories in Africa, the Obajana Cement Factory . MAP OF NIGERIA DEPICTING STUDY AREA Limitation of the Study The major problem in the field of study is language barrier and through these, the researcher that did not understand their language (respondents) will find it difficult to express his mind freely to those that did not understand English language which is the general language in Nigeria, among the respondents. Another problem is illiteracy among the respondents; because some of the respondent finds it difficult to fill questionnaire which is the main information needed from them for the completion of the project. Lastly regardless of these limitations, data collected are sufficient enough to reach the research objectives. 1.8 Definition of Terms Infrastructures It can be generally defined as the set of interconnected structural elements that provide framework supporting an entire structure of development The term typically refers to the technical structures that support a society, such as roads, bridges, water supply, sewers, electrical grids, telecommunications, and so forth, and can be defined as the physical components of interrelated systems providing commodities and services essential to enable, sustain, or enhance societal living conditions The terms housing demand and housing needs are often confused. There are Some key differences between housing demand and housing needs that must beclarified. The meaning assigned to both terms is erroneously similar in manydocuments. The following statement is extracted from the study of housing- Demand models published by the Housing Branch in Hong Kong which asserts that: Housing needs Housing needs is defined as the number of existing ornew households requiring adequate housing. Anadequately housed household is one that lives in selfcontained living quarters made of permanent material.(Liu, Wu, et al. 1996) They also proffer a workable definition of housing demand, viz: Housing demand Housing demand is defined as the number of householdsactually seeking accommodation. In the public sector,demand is assumed to be equal to housing needs. In theprivate sector, demand is constrained by affordability. Facility may refer to: An installation, contrivance, or other things which facilitates something; a place for doing something: Literature Review Infrastructure has been variously defined, according to William Merish and Catherine Brown described infrastructure as the systematic framework which underpins a communitys ability to fulfill its mission of providing a basis of its citizen to productive and to nurture social equity.Omuojine(1997) described it as the stock of fixed capital assets in a country for example Road, railways, Airports, Hospitals, Waterway, power stations, water works, and telecommunication network. It serves as slender threads that weaves together human want and value with those of the environment.Literally, it refers to fixed facilities or installation traditionally provided by public sector. Omuojine (1997) classified it as followed. Transportation including road, railway, airports, seaports and water way. Water supply including water works and Dams Electricity including power stations Telecommunication including postal, telephone, telex, fax, mile services. Health including Hospital, maternity home, and health centers. Sanitation and solid waste disposal. Drainage and Embankments. Infrastructures have certain characteristics viz. Requires large lump sum investment. Entails considerable economic of scale which results in monopolies. Has a high level of externalities both positives and negatives. Intermediate input characteristics. Possess important networks effects. Posses difficulties in cost recovery. While these characteristics have generally remained true, the exact character trait will depends on whether it is urban, rural or inter rural. Infrastructure or trunk and feeder type of fixed/ moving facilities, or the operator of the facility i.e. Whether public or private, central/ state, local Government agencies. Infrastructures include the aggregate of all facilities that enables a society to function effectively, by providing the physical facilities, which moves people, goods, commodities, water, waste, Electricity, road, sewerage and information infrastructure provides an enabling environment for growth and enhanced quality of life.PojuOnibokun (1985) infrastructure is therefore; universally regarded as the engine that drives the city. The linkage between the economy activities and infrastructure continue to grow stronger and more critical as an economic activity becomes increasingly more complicated and global in scope. Lawal (1997). Through the provision of urban infrastruct ure is tradition all the presence of government, the growing difficulties and limitation of public finance and the reality of the wide gap between the demand and supply of infrastructures services with all its pervasive effect inevitably compel urban authorities to look to the private sector and community. Based organization (cbos) for partnership. Babawale (2004) infrastructure is generally poor in developing countries. Although it differs widely among countries and sectors. In Nigeria for instance most households and private companies get electricity form private generating sets because of power holding of Nigeria unreliability. This imposed extra cost on companies and environmental effects on neighbors. There is no water supply in most cities and therefore no waste disposal system. HOUSING DEMAND Housing demand is defined as the housing need people backed up with the purchasing power or the ability and willingness to pay. According to You (1993). As quoted in Olufemi(1993), housing demand could be expressed in term of purchasing power, a function of income, family size, location and tradition etc. Housing demand is different from need. It is only when the need (desire) is backed up with price or rent that we talk of effective demand.According to Robinson (1979), there are three main component of housing demand and these are. From new households, demand from movers between tenure group and demand from existing household within a particular tenure groups. The author also noted that renting is an important feature of demand. This is because the majority of household who could not build or purchase their own home often result to renting. Demand for housing differs from place to place across the socio- economic groups. For instant demand in the city differs from that of the rural areas. Demand also differs among high, medium, and low income groups. Housing demand also changes with time and with social and economic situations. In Nigeria for instance there is a noticeable change in the demand for different type of units. As income and building technology changes. There has been gradually change from the demand for row housing or face to face tenement to more modern housing types such as self contain and flats apartment as well as duplexes. Generally,housing market or sub market of the low income group demonstrates a great diversity of demand, which result from two major factors (UNCHS, 1996) first is there disposal income and the second is how much they are prepared to spend on housing. The amount of money they are willing to spend on housing is in turn determined by the type of accommodation available, the location, s ize, and quality of the houses in terms of infrastructure and services available, and the level of security offered. The demand for housing is a reflection of the ability of household to pay for them. Thus, an examination of households, income and prices of housing unit provides a basis for accessing housing demand, an assessment of the housing demand situation in Nigeria by the UNCHS (1993) reveals that the different income groups are confined to different options. Generally, the poor economic situation in Nigeria during and in the post. Structure adjustment program (SAP) period has affected the purchasing power of the majority. Although household income have risen, in numerical terms, by a factor of about five since 1987, the purchasing power has declined by a factor of about eight(UNCHS,1993). It is therefore observed that the household income of the lowest income group are too low to allow them to exercise any effective demand for formal housing in the open market consequently, majority of the low income household cannot afford any form of formal housing without subsidy. Thus they resort to sur vival outside the formal housing market. For this group the UNCHS (1993) observed that. the present 20% of the household do not earn enough to participate in formal housing market in the urban area. They resort to various informal housing arrangements for themselves. This arrangement includes the setting -up of shanty dwellings of their own on land belonging to them(squatting), renting shanty dwelling, colonization of uncompleted multiples storey buildings, occupation of vacant spaces in public buildings at night,etc. BASIC CONCEPT OF HOUSING. Housing is an empirical word as Salau (1990) has written The confusion of given an exact meaning of definition to housing is perhaps due to the multi-dimensional nature of housing itself Agboola (1998) stated that Housing involves series of processes by which resources such as land, labour, finance and building materials are combine to produce new housing. It involves also the upgrading of existing housing to the demanders .He explained further that housing particular delivery system encompasses the process that allocates housing unit to households in particular country and that housing delivery is stimulated and sustained by the demand and supply mechanism this of course,means that in a free market economy like Nigeria, the forces of demand and supply for housing stock, may determine what stocks come into the housing delivery market and who among the demander get what from the market?. According to Baurue (1981), Housing is the provision of all forms of infrastructures for a conducive living environment whereas habitable and standard houses bythe residential or commercial or any other forms of building properly arranged in a statutorily planned area meeting all the forms of planning rules and ordinances in housings.World health Organization (WHO). Defined housing as a residential environment which includes in addition to the physical structures. The main uses for shelter, all necessary services, facilities, equipment and devices needed or desire for physical or social wellbeing of the family and individuals. Ayeni(1984) defines housing as not only referring to the shelter provided by the structure but also the lot on which the shelter stands and the services provided to the lots such as waterand energy supply, waste disposal, drainage, fire and police protection and kick lighter (1986)defined the term housing in its entire ramification to refer to more than just a dwelling but also included all that is within and surrounds thedwelling. Salau(1990) transcends the physical dimensions of shelter and include the general environment within which the structure is located and the availability of essentialsocial services and infrastructural facilities, which ultimately ensure the satisfaction of the population. National housing policy (1991), housing forms an important part of peoples life and it is rather inseparable from them as it provides the users of occupiers shelters, security, privacy, prestige and a means of self-expression. It is a basic need as everyone requires a shelter, which for most people means a home that, is a permanent base in which the greater part of time is spent. Ozo (1987), asserted that a house must be a home;that is , a resting place in which to try to fulfill the fundamental purpose of human society,namely a secure , rewarding, happy or atleast a reliable life.to the individual family,a house as both a shelter and symbols of physical protection and psychological identity of economic valueand a foundation for security and self respect.Olotuali (1997) stated that housing provides the framework of meeting mans need for shelterand it is all encompassing phenomenon of the creation of the environment, in which man grows and lives and grows.Bourne (1981)summed housing up as a physical entity, a good artifact, an economic good, a capital stockand a statue symbol all at once.Madge(1968) assorted that housing is an important element in all capital formation and the largest single component in total building of any nation. According to Omole(2001), housing is more than a mere shelter in its proper definition , housing can be defined as a residential environment which man uses for shelter and the environment of the structure needed or design for his physical and mental health as well as the social being. Ozo (1987), a house is certainly the bulkiest, the most difficult to move and most durable consumer good. In view of the enormous resources requiredin acquiring housing (since it can hardly be purchase out of ones income in less developed countries). It is true measure of the social- economic statues of a society. Looking at the definitions above .therefore a good housing or shelter development of a group of people and a nation at large. A well determined settlement equally determined the productivity and consumption ration as well as economic, moral and welfare terms of the people or nation. THE NIGERIAN HOUSING MARKET The Nigerian housing market is highly untapped and undeveloped despite lot of opportunities that abound in the sector (Akeju 2007). This is basically due to many reasons amongst which includes. Lack of finance Government policy Lack of infrastructural development High level of poverty. There is continuous increase in the average price of house due to increase in cost of building materials and inflation in the economy. This has highly contributed to the upward trend in the house trend in the house price which has significantly affected the number of unit of houses constructed annually. The Government efforts at addressing the problem have not been successful due to its unsustainable approach of providing houses to the people, the houses are grossly inadequate and unaffordable by the larger proportion of the masses for which they are meant for. There are efforts by the private individuals to help in alleviating these housing problems. The bulk of the housing problems is prevalent in urban cities, but there are lot of un occupied and dilapidated houses in the rural areas to urban centers for greener pastures. Most individual that are involved in property development build for their own uses or are home owners, while the few ones involves in building for commercial purposes, build shops and space to let for offices because if the high rental income accruing from such commercial properties. The residential developments in most cases are illegal, informal and untitled. This is due to long, undue delay to title registration and laxity in enforcing development control regulations by the official of the urban and regional planning department (Fasakin and Ogunmakin 2006). Private sectors contribution toward alleviating this housing problems has been I the form of individual efforts, cooperative societies or association, corporate bodies, estate agents, nongovernmental organization / charity organization and foreign investors, their contributions toward alleviating housing problems in Nigeria are briefly discussed below. INDIVIDUALS This represent the greatest source of contribution from the private sector in most urban centers where the housing problem is very prevalent , a greater proportion of the population dwells in residential houses built by private individuals. These individual financed the project through their personal savings, borrowing from family, friends and lenders or cooperative movements. It can be categorically stated that number of housing unit built by individual have been very substantial when compared with other source of constructing houses. (2) COOPERATIVE BODIES The idea of cooperatives housing have started long time ago when individual planning to own a house seek help from relative, in town, neighbors and friends (Wahab 1988). This concept has been successfully tested and certified in countries like Italy, United Kingdom, Zambia, Sweden and Philippines (Daramola, 2006). It is suited to meet the need of low income earner who constitutes the vast majority of Nigerians. The member of the cooperative are able to enjoy housing loan for the construction of their own housing unit. (3) CORPORATE BODIES. The federal government of Nigeria has realized that they cannot solve the housing problem alone. Has involved the cooperate bodies to contributes their own goals towards the achieving the objectives of housing for all. It was evident that most of the companies have totally neglect for housing needs of their workers. These consequently made the Government come to the rescue of the workers. These consequently made the Government come to the rescue of the workers through the promulgation of employee housing scheme (special provision). Decree 54 of 1979, thus compelling any employer of 500 employees to provide minimum housing of 50 units of which 75% should available for non-executive staff. (4) ESTATE DEVELOPER / AGENTS The private developer or estate agents activities were concentrated in Lagos in 1990 and they play significant roles in the development of the Nigeria housing market (Efin. A and Finmark trust,2010), they ensure adequate shelter is provided to meet the demand of the increasing number of people having housing need. They often employ various finance techniques such as turnkey, pre-letting and joint finance to construct housing unit for the people (Nubi 2000). (5) NON GOVERNMENTAL ORGANISATION AND VOLUNTARY ORGANISATION. In recent year there is increasing trends by non-governmental organization and voluntary organization such as religion bodies to contribute their own effort at addressing the housing problems faced by the people in both rural and urban cities. They assist resetting displaced people having housing problem as a result of natural disaster like war, flood, famine, earthquakes, and etc. (6) FOREIGN PARTNERS / INVESTORS. The government through its various development policies has attempted to encourage foreign investors in the housing market. This is usually in the form of foreign partnership with the local estate developers.These provided more capital base for the estate company, thus making them to be involved in large capital based project. The company are usually handling Government housing project which are capital intensive and required more technical expertise and knowledge. THE ECONOMICS OF HOUSING Housing as a product is regarded as a commodity with an exchange value, according to Angel et.al (1992), housing is viewed as a commodity with an exchange value rather than as goods to be produced and allocated outside the market place. Hence the housing sector is composed as a vast set of exchange relations, driven by supply and demand forces which permit all part of the sector despite the existence of apparently distinctive sub markets. (Agunbiade 1993). The units in the standing stock to be traded in the market have a contribution of attributes and qualities, which determines their selling prices. Such attributes include age and durability of structures, total floor space, structural design and internal layout, location accessibility, ancillary services present, security, aesthetics and the general environmental condition. These attributes distinguish one unit from the other. Thus the structural condition of units and the flow of services they yield determine the value of housing unit in the market. According to Robinson (1979) there are two measure of value in the housing market, these are rent and price. Rent is the payment made for a flow of housing services received over a specific period of time while price is the capital value associated with a particular unit of stockin the ordinary sense, we could argue that the value of housing unit (V) is equalto its price (P) i.e. V = P . However in some cases, the different between the exchange value and the actual value is refers to as subsidy, which is often, paid by Government or corporate bodies to their employees. Thus, subsidy could be regarded as a distortion to the actual market determined price or rent of a housing unit. Housing need, supply and housing price in an economy involved complex processes that are influenced by social and economic force. The understanding of the nature and attributes of the demand and supply of housing is therefore important in any housing study. However, before we address the issue of need, demand, supply and price. It is ideal to consider the characteristics of housing as a product 2.5 ROLE OF INFRASTRUCTURAL FACILITIES ON DEVELOPMENT Ratchiffe (1995) classical rent theory conceptualizes that general improvement in access routes (Roads) have positive effect on the areas land values; Boyce and Allen (1974) in Denver studied the impact of accessibility and amenities on property values. They selected several study areas then applied six (6) criteria encompassing accessibility, amenities and property characteristics and used regression analysis to investigate 24,082 property transactions. They identified a positive impact of infrastructural facilities on property values. Stopper and Meybury (1971) claimed that the relevance of transportations facilities in influencing urban growth and development is reflected in most North. American and Europeans town which shows a growth pattern derived largely from transactional routes. Abouchar (1977) investigated the impact of a subway on property value on Toronto, he studies the metropolitan Toronto subway system through on analysis of the operations of welfare criteria with the basic objective of distinguishing the impact of the subway on property value (demand and price) by looking at year to year relative percentage changes in property values in and out of the subway corridor. However, his analysis concluded that the subway had no effect on the property value in the subway area. The validity of findings and conclusion are questionable as the study did not fulfill the requirement of a before and after approach because the analysis of the property market was concluded in 1992 the date the subway began its operation. Abdulateef (1997) observed a positive impact of road transportation and communication on land use development and property values, the provision of infrastructural facilities in any socio economic unit whether a nation, region or community could have either a positive or negative impact on property value. For instance, the provision of an incinerator in a residential district will have a negative effect on the value of the properties in that area while the provision of infrastructural facilities like good roads network, water and electricity supply, drainage system, good refuse collection treatment and disposal system etc enhances values to unpre cedented level just as the inadequacy or lack or these facilities adversely affect value as a paradox. 2.6 IDENTIFICATION OF PUBLIC UTILITIES MANAGEMENT AGENCIES IN NIGERIA The prominent public agencies for the provision and management of the infrastructural facilities in Nigeria are: Power holding company of Nigeria Plc. In charge of electricity generation, distribution and supply to consumers (PHCN) Nigeria telecommunications limited (NITEL) State water corporation State waste management boards Federal road maintenance agencies (FEMA) Nigerian communications commission (NCC) Federal air