CHAPTER
ONE
INTRODUCTION
1.1 Background to the
Study
The term real estate
is commonly used interchangeably with real property to refer to land and all
things permanently attached to it. Property in itself consists of valuable
rights held to the exclusion of others (Betty and Ely,2008). The definition of
real estate typically includes land, fixtures (attachment) to land, anything
incidental or appurtenant to land that benefits the land owner and anything
which is immovable by law. Real estate is a readable commodity with a
specialized market due to its unique characteristics of geographical
immobility, heterogeneity, fixity, indivisibility and indestructibility. In
addition, investment in real estate requires a large capital outlay and is
surrounded both by many legal factors and government regulations (Ventollo and
Martha, 2001).
The decision to
invest in real estate is fast becoming the preferred choice for most Nigerian
investors who consider it one of the most stable forms of investment. In
addition, the rapid increase in the price of Nigerian real estate has made many
investors venture into real estate as a source of income. In recent years, the
Nigeria real real estate market has seen a new breed of investors who are
targeting capital growth/ appreciation as the most important source of return
for real estate investment through their sale.
Nigeria in recent
years has been flooded with developers bringing property into market for sale,
rather than for the purpose of obtaining a stream of income in the form of
rent. Ventollo (2001) simply defines a market as a place where buying and
selling takes place. Due to the unique characteristics of related estate, the
market for real estate all over the world does not conform to the definition of
an efficient market. An efficient goods market is one where the products have
close substitutes, many buyers and sellers who have perfect knowledge of prices
and goods exist there is little government interference and the product is
easily transferable. Real estate requires professionals who possess an
understanding of the processes to mediate between the concerned parties who
include but are not limited to financiers, developers, sellers and purchasers.
The rapid increase in the prices of rel estate has made many investors and
unregistered agents ve tire into real estate as a source of income.
1.2 Statement of the
Problem
The practice of
estate agency is not a new concept in Nigeria. However, it has for a long time
been associated purely with the commercial transaction of letting properties
for landlords, buying and selling land, factories, houses, commercial premises,
businesses as going concerns hotels and the ownership rights associated with
them. The agents acts on behalf of the seller or on behalf of the buyer for a
commission. In this regard, in addition to the firms registered to carry out
this practice, there have also been a large number of estate agents practicing
without any background knowledge and/or understanding of real property as a
commodity and the real estate market as a special one. Hence there is need to
assess the proliferation of unregistered estate agent in real estate market.
1.3 Objective of the
Study
The major objective of the study is
proliferation of unregistered agents in real estate market.
1.4 Research
Questions
(1) what is real
estate?
(2) what is real
estate market?
(3) who are real
estate agent?
(4) what is the rate
of proliferation of unregistered agents estate market?
1.5 Significance of
the study
The study gives a
clear insight into the proliferation of unregistered agents in real estate
market. The need for this study arise because estate agency as a profession in
this country has seen an influx of numerous unqualified persons because there
exists a conflict between professionalism and commercialism in the practice.
These people come in to provide agency services in the real estate market yet
they have no knowledge of either real estate or the market within which it is
traded. As a result, the real estate market, is plaques by inefficiency and
lack of transparency due to unregistered agents. The study also emphasizes on
the need. to enforce a law that will govern the real estate agent
1.6 Scope of the
Study
The research focuses
on the proliferation of unregistered agents in real estate market.
References
Betty and Ely (2008)
Basic Real Estate Appraisal: Principles and Procedures, (7th end) Thomson South
Western, U.S.A.
Ventollo, L. and
Martha, R.(2001) Fundamentals of Real Estate Appraisal, Dearborn Real Estate
Educator, Chicago.