EFFECT OF RURAL/URBAN MIGRATION ON RENTAL VALUES IN PORT HARCOURT

ESV Ilo Ndubueze Benneth

DEFINITION:
Urban migration is the movement of people from their usual place of residence (country side areas) to urban centers (cities). This movement is driven by the search for economic opportunities, better quality of lifestyle, security (Internally Displaced Persons) and social services, which significantly contributes to urbanization.

EFFECT OF URBAN MIGRATION ON REAL ESTATE –
(PORT HARCOURT AS CASE STUDY)
Port Harcourt, as one of the cities in Nigeria that has experience massive population growth due to migration. This has grossly impacted the Real Estate Sector with its attendant effect on rent. As we all know, the demand for better housing continues to exceed supply.

As more people continue to relocate to Port Harcourt, the pressure on housing stock increases, hence causing rental values to rise. In order to achieve sustainable urban growth, Real Estate Practitioners, Developers and Policy Makers need to understand the effect of migration on rental values.

REASONS FOR RURAL-URBAN MIGRATION

1. Better infrastructure and social amenities
2. Employment opportunities
3. Conflict, persecution and disaster
4. Access to better healthcare
5. Access to quality education
6. Improved standard of living

IMPACT OF RURAL/URBAN MIGRATION ON RENTAL VALUES IN PORT HARCOURT
As posited earlier, rural/urban migration in Port Harcourt like other cities drives up rental values due to an influx of new residents. This movement creates a surge in demand considering the supply constraints. As we are aware, housing supply does not grow at the same rate, for these reasons;

a. Slow Construction: Property developing is capital intensive and if the construction of new rental accommodation does not keep pace with population growth, the result of housing shortage drives up cost.

Housing development can be slow when it is obstructed by several factors which includes access to finance, land, materials and resources, governor’s consent and approvals, which have made it impossible to have potent demands for housing as developers are almost choked by demands, resulting to lack of housing and increased rents, proliferation of slums and poor living conditions. More importantly, it also hinders economic growth by reducing investment and job creation in the property construction sector.

b. Housing Stock Pressure: Urban settlements can experience deterioration over time. This could be as a result of neglect to change of use, paucity of funds and sometimes misappropriation of resources. Critical study shows existing housing stock within a city’s municipality is never enough.

The influx of migrants to Port Harcourt exerts stress on the existing housing stock. Some indicators such as habitable space, physical condition, availability of basic social infrastructure and services and environmental quality of the housing unit were measured and statistics show that they were affected by such influx.

c. Regulatory Environment: The regulations set by governmental/industrial associations to govern property development, ownership, and use, which include aspects like land use, environmental protection, building safety, and financial practices can impact the decisions for investors, developers, and occupiers, and navigating such regulations require thorough due diligence.

These policies influence how land can be used, affecting property development from zoning.

d. Overcrowding/population growth
e. Pressure on infrastructure
f. Lack of affordable housing options
g. Inflation (increase in cost of living).

RECOMMENDATIONS:

To control the impact of Rural–Urban Migration, it is very important that;

1. The government should encourage and promote affordable Housing Policies through Public/Private Partnerships like Greater TAF City.
2. Government at every level should promote development across Rural and Urban areas. This will reduce the pressure on people to migrate
3. There should be a rent edict. This will control the arbitrary rent increment aimed at protecting the low income earners.
4. The urban housing infrastructure should be expanded through deliberate urban planning policies.

CONCLUSIONS:

Urban migration is inevitable. It creates both beneficial and detrimental effects for Rural and Urban (destination) centers and migrants themselves. It stimulates economies, societies and places strain on social services and infrastructure.

Its impact on rental values is a major challenge to urban sustainability. It is a major contributor to ever increasing rental values.

In a bid to solve this, the state government as a matter of urgency should invest in affordable housing schemes that will boost supply, hence reducing the pressure and bring stability to the rental market.