Critical determinants of residential property value : professionals’ perspective

Abstract

Purpose: Real estate property has been established as a composite good, and its value is determined by many variables. The heterogeneous nature of real estate property has made different stakeholders value these variables differently. Therefore, this study aims to identify and evaluate these sets of variables which influence residential property value in the Lagos metropolis property market, Nigeria, based on professional valuers’ perception. Design/methodology/approach: A list of variables that influences property value was generated through literature review, and the list was used to design an online questionnaire that was administered to valuers practicing in the metropolis. The valuers were asked to rank these variables in order of significance. Their response was analysed to establish the mean score of each variable that depicts their level of significance. Findings: In order of importance, property location, neighbourhood characteristics, property state of repair, size of property, availability of neighbourhood security and age of property are the most highly significant variables that are influential on the property value in the Lagos metropolis. Practical implications: The findings of this study will inform all existing and prospective real estate stakeholders, including facility managers of the major determinants of the value of their investments and, at the same time, will be a tool for valuers and researchers in property value modelling. Originality/value: This study is the first attempt to develop a framework of property value determinants in this research area in Nigeria.