EFFECT OF ROAD EXPANSION ON RESIDENTIAL PROPERTY RENTAL VALUE.
ESV Olorunnisola Abiola
The urban road expansion project is a major component of urban renewal program carried out in the south- western part of Nigeria.
The contribution of Infrastructure to urban development cannot be overemphasized. Functionality of a city depend on provision of major infrastructural facilities which include electricity, water, education, health, tourism, communication and transportation facilities to enhance the life and livelihood of its inhabitants.
It is important to mention that infrastructure enhances physical growth of the host communities and contributes significantly to the socioeconomic development of urban cities. It is also linking the development of infrastructure to the improvement in productivity and employment opportunities. Hence, the investment in infrastructure stimulates local economic activities and attract foreign investment.
Like other major developing nations, Nigerian urban cities are witnessing infrastructural development that include development of road infrastructures. The impact of these road infrastructures on the economy is debatable and uncertain. The contentious debate revolves around its social benefit (positive) and social cost (negative) particularly on the land value (rental and sales) and land use dynamics.
The real estate market is not left out of the contentious debate on the effect of road expansion on economy. Previous studies have identified two major effects of road construction on proximate real estates. On the one hand, it is of the believe that highway improves the private capital investment in real estate property but at vary levels, depending on the proximity of the property to the road infrastructure. Similarly, it has been observed that increasing return on commercial property investment attributed to increasing government spending on the road infrastructure.
On the contrary, the negative effects associated with road construction include road traffic intensity caused significant variability in residential rental prices. Also, sleep disturbance, which increases risk of health challenges such as shock, hypertension and depression, and could have adverse effects such as discouraging influx of house seekers to the proximate residential property value to road traffic. Another area of concern is the impact of road infrastructure development on land use dynamics whether encouraging/discouraging the growth existing land use or emergence of new land use.
