Problems and Prospects of Forward Sale in the Nigerian Housing Market: A Critique of Policy and Modus Operandi

One way of dealing with the challenge of demand uncertainty in property market is the use of forward sale. However, despite the huge demand for housing in Nigerian urban centre, it appears that the strategy is not popular with the demand base as expected. This study therefore examined the challenges of forward sale in the Nigerian housing market. This was achieved by reviewing the institutional policy provisions and operational guidelines within which forward sale transaction is conducted in Nigeria. Existing studies in this regards were reviewed while the opinion of three categories of respondents, the developers, buyers and estate surveyors and valuers in the Metropolitan Lagos State were obtained with the use of structured questionnaire. The percentages of options of responses were ranked. The study found that while developers prefer to harness the benefits of forward sale optimally, buyers are reluctant to use the method. Different challenges were responsible for this situation amongst which is the lack of policy protection for the buyer’s thereby exposing them to developer’s default, poor construction quality or delayed implementation. It was suggested that government regulate forward sale market to improve buyer’s confidence thereby providing developers with unhindered access to development fund at no cost.