CHAPTER ONE

1.0 INTRODUCTION

1.1 Background to the Study

The choosing of the best alternative form of real estate investment has been identified as

a prominent challenge facing real estate investors in Nigeria. Investment opportunities abound

among numerous options available to prospective investors in the real estate market. A salient

option amongst them is an investment in residential real estate. This is because most cities and

nations at large thrive on the economic prowess of their industry and commerce but no matter

how fast the commerce may be, the need to retire to a place of residence cannot be over

emphasized.

Residential property provides housing as one of the most basic needs of mankind. It is a

fundamental element of human settlement that meet the basic needs in which people live. It

connotes an essential and vital component in both social and economic framework of a nation,

and the performance of the housing sector is frequently seen as a determinant of the stability or

instability of a nation. It is a social unit of space and the significance of living conditions which

is recognized for centuries as a primary prerequisite for health, work efficiency, social-economic

standards, productivity, general welfare, growth of the individuals and neighbourhood.

Housing and neighbourhood are inseparable, because it is not just about the floor space;

It is about the vibe of the area, the neighbors, the amenities, schools, friends, shops and parks,

transit or traffic, amongst others. Neighbourhoods are also known to have a complicated

interplay between the residential choices of housing supply and the influences of the larger

metropolitan system on its constituent part. This is to say that the characteristics of a particular

neighbourhood have a significant impact on the individuals choices of resident and these
characteristics of neighbourhood differ from one place to the other. Although, a lot of studies on

the effect of neighbourhood characteristics on rental values of residential properties have been

conducted globally and locally, the need to evaluated vis-a-vis the trend is rental values have not

been really evaluated particularly in the study area. Hence, in a bid to contribute knowledge to

this field of the study, the researcher examines the impact of neighborhood quality on rental

values of residential properties in Enugu, Nigeria.

1.2 Statement of the Problem

In recent times, housing has formed part of the major discussions in several global

summit, this shows the complexity of housing in the global market . Housing is bedeviled by a

number of risks which include property crime and the consequences of residential

neighbourhood crime affect residents, entire neighbourhood, government activities and housing

investment in particular. In another related development established that neighbourhoods are also

known to have a complicated interplay between the residential choices of housing supply and the

influences of the larger metropolitan system on its constituent part. This is to say that the

characteristics of a particular neighbourhood have a significant impact on the individuals choices

of resident and the amount they are willing to pay for residence in such neighborhood, These

characteristics of neighbourhood differ from one place to the other.

Enugu, Nigeria, being a city with many residential neighbourhoods is having varying

neighbourhoods with homogeneous characteristics from the heterogeneous population and the

variation of the rental values of housing across the study area is alarming. Different authors as

have found a relationship between neighbourhood and environmental quality and property rental

value. Hence, it is expected that the changes in the rent commanded by properties over the years

will be affected by the corresponding neighbourhood quality. It is against this backdrop that the
researcher proposes to analyse the impact of neighbourhood quality on rental trend of residential

property values in Enugu, Nigeria.

1.3 Aim of the Study

The aim of the study is to evaluate the impact of neighbourhood quality on rental trend of

residential properties in Enugu, Nigeria with a view to providing information that will aid

investment choices in the study area.

1.4 Objectives of the study

The objectives posited for the study are to;

1. Determine the socio-economic features and characteristics of neighborhoods in Enugu,

Nigeria.

2. Assess the quality of neighbourhoods in the study area.

3. Assess the trend in rental values of residential properties in the study area from 2015-

2022.

4. Analyse the relationship between neighbourhood quality and rental trend in the study

area.

1.5 Research Questions

1. What are the socio-economic features and characteristics of neighbourhoods in Enugu,

Nigeria?

2. What is the quality of neighbourhoods in the study area?

3. What is the trend in rental values of residential properies in the study area?
 4. What is the relationship between neighbourhood quality and rental trend in the study

area?

1.6 Hypotheses

H0: There is no significant relationship between the impacts of neighborhood quality on rental
trend of residential properties in Enugu.

H1: There is a significant relationship between the impacts of neighborhood quality on rental
trend of residential properties in Enugu.

1.7 Significance of the Study

It is hoped that this study will be relevant to Estate Surveyors and Valuers, Appraisers,

prospective real estate investors, developers, and other stakeholders in the real estate industry in

Enugu. It will also prove relevant to Estate Management lecturers and students in the

universities, polytechnics and college of technology who are interested in understanding the

impact of neighborhood quality on rental trend of residential properties in Enugu.

The study will provide an in-depth understanding of the impact of neighborhood quality on rental

trend of residential properties in Enugu that will enable informed decisions when investing in

residential properties in the area.

This study will also provide invaluable insight into the current market trends and help identify

the potential areas of growth in the study area. Furthermore, the study will provide real estate

investors with a better understanding of the potential returns and risks associated with investing

in residential properties in Enugu and how to mitigate them.

Finally, thorough examination of residential property rental trend will go a long way in guiding

investment in residential properties an improved the quality of housing stock at the formulation

of rent control.
1.8 Scope of the Study

This research is to cover the impact of neighborhood quality on rental trend of residential

properties in Enugu, Nigeria. Geographically, the research will cover residential neighborhoods

in Independent layout and new haven. Six (6) residential neighborhoods will each be selected in

both. Independent layout and new haven. The selected Six (6) residential neighborhoods will

depict two (2) high density, two (2) medium density and two (2) low density residential

neighborhoods. Also, the study will cover one bedroom flat and two bedroom flat as the most

demanded residential properties in the study area. The study will also utilize rental values of

commercial properties in the selected hubs over a period of 7 years spanning 2015 to 2022. This

period is chosen because of the changes in neighborhood and economic features over the period.

1.9 Limitation of the Study

There were some gaps in the available data on rents paid by property occupiers on residential

property investments in Enugu from 2011-2021. Attempt was made to close these gaps by

determining weighted rent for each type of residential property investments for each of the years

under study which gave rise for the need to consider the rent review pattern in the study area for

residential properties.

In carrying out this research, certain problems were encountered by the researcher especially in

the area of data collection which proved to be the most difficult aspect of this research work not

only as a result of the uncooperative attitude of many respondents sampled but because of
repeated journeys made to administer the research due to busy office schedule of the respondents

when visited.

CHAPTER TWO

LITERATURE REVIEW
2.1 Conceptual Framework

2.1.1 Concept of Neighbourhood

The concept of neighbourhood is perhaps one of the most important planning standards that

shaped the city system and urban form of the twenty-first-century city in many countries

(Patricios, 2002). A neighbourhood is the smallest planning and design unit required for the

development of blueprints for residential areas or layouts. Inhabitants may all share the common

amenities and services, facilities, and social activities essential in the surrounding area of the

dwellings within the region. The population of neighbourhoods varies from 2,000 to 8,000

necessitating land areas of 20 to 100 hectares (Charles, 2000). The concentration of development

is the major decisive factor. The main theoretical difference between the house and the

neighbourhood is related to space. The neighbourhood require amenities and services, facilities,

and social activities within its confined area for it to function effectively (Meenakshi, 2011).

Dubin (1992) and Egert & Mihaljek (2007) defined neighbourhood as a confined area in which
certain and specific land-use activities are involved, attracted, and retained by sets of linkages

which are the glue that holds a neighbourhood together (Fong & Milena, 1999). Linkages may be

thought of as external economies and centripetal forces. It is the periodic interaction between

people or establishments that draw and hold them together (Power, 2004; Cheshire, 2007). In a

residential neighbourhood, linkages may exist between the home, shopping, schools, recreational

parks, health care centres, social and religious centres, and place of employment (Denton &

Douglas, 1991; Aliyu et al., 2015). Whittick (1974) defined neighbourhood component as

planned urban areas related and integrated to the larger community and consisting of open

spaces, residential areas, schools, shopping facilities, industrial and religious buildings among

others (Chahal, 2000; Meenakshi, 2011). The term neighbourhood has been regularly mentioned

in the context of traditional and modern residential development (Makinde, 2019). Ever since the

invention of the concept ‘neighbourhood' in 1929 by Clarence A. Perry, it has turned out to be a

regular theme in planning several cities in the world. The planning organizations continue to

familiarize and make regular use of the neighbourhood when designing and planning a layout for

new communities. The physical and social meanings of neighbourhood need to be understood to

be able to carry forward its principle for the benefit of planned development efforts.

Neighbourhoods have some specific social and physical characteristics that differentiate them

from other types of settlement. The gathering of these neighbourhoods has transformed into

cities, villages, and towns (Meenakshi, 2011). The neighbourhood as a development and design

concept emanated in response to the deteriorated physical, social, cultural, institutional and

environmental conditions nurtured because of the industrial revolution in the 1900s.

Nevertheless, it evolved to assist a much wider purpose of providing a visible character for the

concept of the neighbourhood and contribution to designers to formulate a blueprint and

framework for breaking the city into smaller subareas. This model delivered definite guiding

principles for the spatial circulation of streets, businesses, residences and community services

(Lawhon, 2009). The physical design of this type will tend to generate neighbourhood

association and local social control and regulation, which are missing in many parts of the

contemporary city. The physical design of a neighbourhood is a factor that determined its social

aspects. It assumed that physical designs could promote social progress. Perry’s emphasizing the

concern for the quality of the architecture, aesthetics, the layout of streets, and the importance of

planting alongside curbs and in yards, the planning, arrangement and setback of buildings are the

significant qualities for consideration in the development of the neighbourhood (Perry, 1929).

2.1.2 The Conception of the Neighborhood Quality

According to Perry, (1929) the physical organization of the local shops, elementary school,

playgrounds and small parks where the root of neighborhood concept. Every neighborhood was

to be a unit of the city (Patricios, 2002). Perry defined the neighborhood component as that

inhabited area that would necessitate and support the school with an enrolment of between 1,000

and 1,200 pupils (Gallion & Eisner, 1984). Perry enumerated six important principles of

neighborhood quality design. These essential principles were structured around several social

and physical design and institutional ideals. Major roads should not pass through residential

neighborhoods. Instead, these roads should provide borders to the neighborhood; Inner street

arrangements should be designed and built through the use of cul-de-sacs pattern. Also, it should

be curved design for layout and light-duty surfacing to encourage low volume traffic movement,

a quiet, safe and protective of the residential environment. The population density of the

neighborhood should support its elementary school. The neighborhood focal and central point

should be the elementary school that is centrally situated on a common area, along with other
establishments that have amenities and service areas coextensive with the neighborhood borders.

The radius of the neighborhood should be a maximum of one quarter of a metric. This should

rule out a walk of more than that distance for any basic schoolchild; and shopping areas should

be located on the verge of neighborhoods if possible at major road intersections. Three

neighborhood components served by an elementary school and two or one major commercial

centers, the range for walking distance to these amenities and services being one metric (Berk,

2005; Meenakshi, 2011).

Numerous important criticisms and disapproval of the neighbourhood had been pointed out in

the planning and design literature. In the 1940s, the neighbourhood idea came under criticism

from Reginald Isaacs. Isaacs (1948a) held that the overwhelming support of the neighbourhood

component, as a solution for all urban problems, was ill-advised; advocating that the powers and

supports accredited to the concept by its supporters bring about a dangerous discourse relating to

its purpose. Isaacs (1948a & 1948b) attack on neighbourhood component was based on its

applications that were being misused as a tool for the segregation of religious, racial, economic

and ethnic groups by private developers prepared to use the gated-community feature of the

neighbourhood (Allaire, 1960). Isaacs (1948) argument became a rallying point for the collective

opposition of the neighbourhood, as planners began to question the unintended consequences of

its repeated use, its socially divisive nature and its emphasis on the physical environment as the

sole determinant of wellbeing. In developed countries across the globe, the spread of urban

systems, which embrace obsolete or impractical uses of space to manifest a synthetic rural

community lifestyle, was increasingly viewed as a blight upon attempts to achieve sustainable

metropolitan growth. In the past, Isaacs (1948b) argument was weakened through its inability to

provide an alternative framework for community planning. In the present, planning bodies
internationally, both private and public as of 2004, continue to adapt and make modular use of

the neighbourhood component when planning new communities (Berk, 2005). It is becoming

clearer that a reconsideration of the current hetero-normative approach to planning layout of new

communities on the urban periphery, or in the re-planning of existing and present

neighbourhoods, which needed to satisfy density objective and enhance sustainable development.

There is a need to trace the physical, design, institutional and social forces that produced the

principles that influenced and controlled the development of the neighbourhood concept. The

neighbourhood, as envisaged by Perry had influenced community layout planning and design

since its commencement (Allaire, 1960).

2.1.3 Rent

Ratcliff (1978) stated that “historically rent was used to refer to any periodic payment to a

landlord for the use of property or land. There are different meanings or concept of rent as - used

even by economist and valuers. These include contractual rent, economic rent and market rent.

Barlowe (1978) states that rent is only applied to payment made for factors of production which

are perfectly inelastic in supply. In the words of Lawal (1997), rent is the amount of money paid

for the use of a unit of real estate for a particular period of time and it may also be defined as the

annual or periodic payment for the use of land and building. A more acceptable perception of

rent was established by Kuye (2003) as the use of another person’s property. This payment could

be weekly, monthly or yearly depending on the terms and conditions of the tenancy. Rent is a

periodic payment made by a tenant for the use of a property of another person known as the

landlord (Adegoke, 2005).

2.1.4 Value
Value of real estate is a function of physical, locational and legal characteristics of the property

(Ling & Archer, 2006), influenced by increase or decrease in population, change in age

distribution of population, change in taste and fashion, change in technology, change in building

methods, change in building cost, inflation and deflation, change in culture and planning control,

institutional factor, location and complementary uses (Millington, 1979; Oyebanji, 2003).

Related studies (Jim & Chen, 2006; Chun-Chang et al., 2013) have attributed increase in

property values to improvement in environmental quality. However, with the present deplorable

conditions of most neighbourhood infrastructure as evidenced in poor roads, broken water pipes

and blocked drainages amongst etc.

2.1.5 Rental Values

The relevance of rental values to real property investments cannot be over-emphasised.

According to Ekenta, (2010), rental value is the monetary return which may reasonably be

expected to be obtained from letting a property in the Open Market at a particular point in time.

By Open Market here, we mean that all the parties must be aware of the rent the property will

command in the market.

2.1.6 Residential Properties

The residential properties exist in different forms and they are type of properties that are used for

dwelling space. Residential property may be privately owned residences as well as government

and institutional housing; it is the largest source of demand for the services of professional

property managers.

Residential dwelling can be built in a large variety of configurations. Examples include the

following:

i. Bungalow
This is a dwelling unit on a single floor or ground floor. A bungalow could be detached or semi-

detached duplex.

ii. Detached houses (free standing)

This includes a house that is completely separated from its neighbours. It is a single

accommodation unit existing on two floors (it is known as bungalow where the unit is existing

on a single floor). Detached houses usually have a convenience that is kitchen and toilet on the

ground floor as well as sittings and guest room. The bedrooms as well as family sitting room are

on the first floor.

iii. Semi-detached houses

These are two separated residences, by strict definition side-by-side, but incorrectly sometimes

used to mean stacked apartments on two different floors. The duplex often looks like two houses

put together or as a large single home, and both legally, structurally and literally share a wall

between halves.

iv. Flat houses

These are houses or buildings with two, three or four flats, respectively, especially when each of

the flats takes up one entire floor of the house. There is a common stairway in the front and often

in the back providing access to all the flats.

v. Maisonette

This is an apartment or flat on two levels with internal stairs. A building containing maisonette

will usually have several floors and every two floors will hold a maisonette. A typical example is

the 1004 flats on Victoria Island Lagos.

vi. Tenement buildings

This is a multi-unit dwelling, made up of several rooms on each side of the building. These

rooms face one another. Tenement buildings can exist on one or two floors. All occupants share

the conveniences which is generally located at the back of the building.

2.1.7 Meaning of Trend

Trend is defined by Longman Dictionary of contemporary English as a series of related changes

brought about by a chain of causes and effect. In the words of Nsude, (2002), trend is a path

which time series graph appear to follow over a long period of time. A trend can be o downward

or upward, horizontal or vertical depending on the series of related changes that is identified and

projected into a plausible future (Iroham, 2013). Trend movements is known as secular

movements of series and it indicates a gradual growth or decline of the factors being observed in

case of rental values. The trend value of a time series cans be obtained by any of the following

methods; Free Hand Method; Semi-Average Methods; Least Square Method and Moving

Average Method. Also, Idudu (1989) and Omuojine (1994) in a related study on trends in rental

value observed that urban rents in Nigeria have maintained an upward movements in the

previous two decades.

2.2 Empirical Framework

The literature review in determine the neighborhood quality are taken from previous research on

residential and neighborhood environment. Most research and neighborhood environment deal

with physical factors, social factors and economic factors (Fomara, Bonaiuto, & Bonnes, 2010).

Basically, the neighborhood quality is influence by neighborhood attributes, home attributes and

jurisdictional attributes Greenberg & Crossney, 2007). The neighborhood quality is also

associated with social capital, security and adequacy of facilities (Yang Shih & See, 2002). the
neighborhood quality is about the environment condition and the residents’ characteristics

(Greenberg, 1998).

Most of the researchers use multivariable for physical factors. Aiello (2010) use the functional

and environmental aspects such as architectural and town planning features, services and

facilities, crime and security as physical multivariable factors. Lovejoy (2010) use attractiveness,

quite, liveliness, big yards, safety, mixed use and good infrastructure in evaluating the physical

attributes. Mohit (2010) apply physical factors on the environmental aspects such as noise level,

accident situation, crime situation, security control and community relations as well as the public

facilities and the distance of neighborhood facilities provided. Bonaiuto (1999) utilizes other

physical elements related to architectural and urban planning space such as the organization of

accessibility and roads, green areas, welfare services, recreational services, commercial services,

transport services, environmental health and upkeep. Hur, Nasar and Chun (2010) develop other

physical measures used in influencing the neighborhood quality such as the attributes of the

surrounding environment, perceived attributes of the environment and evaluation of the attributes

of the surrounding environment. Serrano (2009) is concerned with the physical factors

influencing the provision of neighborhood quality such as noise, pollution, environmental

problems and crime or vandalism. Lofti and Koohsari (2009) evaluate the accessibility to public

spaces such as to local parks, the stores and elementary schools. Zhao (2009) considers the

physical in spatial aspects such as architectural planning space, organization and accessibility of

space, green space. The physical factors measured in functional aspect are welfare, recreational,

commercial, transport services. The physical factors used in contextual aspects are pace of life,

environmental, environmental health and upkeep.

Social factors that influence neighbourhood quality are the residents’ demographic backgrounds,

community interaction and place attachment. Many researchers use the socio-demographic

variable to evaluate the residents’ satisfaction perception on their housing and neighbourhood

area. Different socio-demographic will give different individual data in the housing and

neighbourhood area (Apparicio, 2008). The socio-demographic background used by Aiello

(2010) and Erkip (2010) are gender, age, income, tenure, length of residence. Aiello (2010)

utilize socio-demographic indicators that involve persons living together, families composed of

one member, families composed of four members or more, widows or widowers. Lovejoy (2010)

exercise the level of education as part of socio-demographic backgrounds. Lee (2008) uses

variables such as age, education, health, and marriage status in the residents’ satisfaction

perception. Rogers (2009) use socio-demographic factors like gender, age, number of children,

household size, level of education and race. Tu and Lin (2008) use personal characteristics such

as age and gender that are effective predictors of residential satisfaction. Barton (2009) uses

other socio-demographic variables namely culture and ethnicity.

Community interaction in housing and neighbourhood area is one of the social factors

influencing the residents’ satisfaction in neighbourhood quality. Aiello (2010) uses community

interaction variables that are related to social relation features and context features. Social

relation features involve psychology aspects. On the other hand, context features involve

environment aspects. Mohit (2010) uses the relationship of the residents and the environment in

their housing and neighbourhood area for the community interaction. Bonaiuto (1999) uses

variables like social relational features and pace of life for the community interaction.

The economic factors involved in the provision of neighbourhood quality are residents’ socio-

economic backgrounds and economic value in the neighbourhood. Socio-economic includes

income and homeownership (Erkip, 2010). The socio-economicaspect also involves the

residents’ employment, dependence index and old age index (Aiello, 2010). The aspect also

includes the annual household income and household size (Lovejoy, 2010). It’s also taking into

consideration the individual characteristics such as health, migration, labour situation, income

and household characteristics which are incorporated with the duration of residence, annual

income, household size and housing costs artificial the condition of neighbourhood quality

(Serrano, 2009). The socio-economic inequalities consist of level of income, unemployment rate,

private car ownership and the quality of buildings (Lotfi & Koohsari, 2009). Additional socio-

economic factors are home ownership, transport ownership, household income, work within

community and full-time homemaker (Rogers, 2009).

In determining the quality of residential development and suitability of neighbourhood, which is

a degree of the acceptability at a specified time and place and a given set of sociocultural,

technological, economic, environmental and physical conditions (Makinde 2019). Five important

principles are stipulated which recommended that neighbourhood must be in agreement with

tolerable standard, energy-efficient and functionality. Furthermore, it must be free from the

severe poor condition, provided with up-to-date services and facilities, and must be safe, private,

secure and healthy (Neilson, 2004). These factors comprised variables such as; access and

affordable basic housing and the quality of infrastructural services and amenities, public

facilities, quality of design and spatial adequacy. Also, it should comprise fittings and fixtures,

landscaping and building layout, pollution and noise control as well as privacy and safety

(Ilesanmi, 2012). There are nevertheless factors from several studies that a particular variable

might not be adequate to measure the qualitative and quantitative nature and environment of

residential development. Consequently, neighbourhood qualitative and quantitative assessment

and acceptability should as well take into consideration materials used, type of constructions,

design and spatial arrangement, facilities and services within residences, efficiency, function,

aesthetics, safety and privacy among others (Jiboye, 2011; Amao, 2012). In assessing the

neighbourhood quality, scholars have acknowledged some factors as significant variables for

quality assessment in housing development. Ebong (1983) identified ease of movement, air

pollution, waste and sewage disposal, noise and pollution level in the neighbourhood, age of

building, design and spatial adequacy. Others comprised: aesthetics, privacy and safety,

ornamentation, sanitation and drainage, access to basic neighbourhood facilities and among

others, as significant quality factors in the neighbourhood. Nevertheless, Bajunid et al., (2012)

concluded that quantitative and qualitative neighbourhood requires the establishment of

infrastructural amenities and services that will result in sustainable evolution and development

through enhanced spatial design, environmental, social and physical conditions that improved

livelihood. Ilesami (2012) identified neighbourhood quality indicators, which included: external

and internal visual quality, construction material and structural quality of buildings, specification

quality of buildings, quality of facility amenities and services, quality of neighbourhood roads

and landscaping, open spaces, environmental layout and locational quality of the area. The first

five factors related to the housing as a unit, while the next five criteria have to do with their

neighbourhoods. The criteria as a whole cover aesthetic, functional, and technical qualities.

Adverse and unplanned neighbourhood affects the social, cultural and economic prospects of the

people. Studies had shown that well-planned neighbourhood has been established to be a

significant motivation for residents’ wellbeing, specifically in the area of coming out of poor

health and for children’s upbringing (Makinde, 2019). For the fact that the quality of the

neighbourhood a family, live in influences important social economic and residents’ quality of
life (Rabe &Taylor, 2009). Neighbourhood quality characteristics affect the possibility that

people's social connections will improve (Sampson et al., 2002). Social and physical

environments in neighbourhoods can be visibly hazardous; for instance, ethnic conflicts, crime-

infested or polluted areas can strictly limit the options and assets accessible to individuals

(Cubbin et al., 2008). Concerns for neighbourhood quality have instant everyday consequences.

Physical characteristics of neighbourhoods, for instance, the absence or presence of basic

facilities, housing quality, dependable public transportation, reliable hospitals, and availability of

retail stores are important factors of well-being (Josiah, 2014).

Neighbourhoods with inadequate quality housing, little resources, poor design and with the

unsafe environment will inflict stress, which can result in hopelessness. The stress resulted from

adverse neighbourhood increased despair beyond and above the consequences of the individual's

delicate stressors. For instance, negative events and poverty within the workplace or the family

(Cagney et al., 2009). Furthermore, adverse neighbourhood quality appears to strengthen the

damaging impact of individual stressors and hamper with the development of bonds connecting

people, once more escalating threat for depression. Neighbourhoods do not similarly influence

all individual in the same way, this is because individuals have diverse personality

characteristics, diverse behaviour, varied demand and requirements expected in neighbourhoods

(Cutrona et al., 2006)

Empirical studies have attributed increase in property values to improvement in neigbourhood

quality. Residential properties are both consumption and investment good. The demand for

residential properties in Port Harcourt has been on the increase in the past few years, thereby

leading to increased rental value. The physical characteristics of the property such as number of

bedrooms, age, size, various amenities and services have been noted to help determine the rental
price for landlords as they set rental prices for residential properties. (Yuzhou and Haurin, 2010).

In addition, external factors such as population, income traffic congestion, proximity to work,

access to public transportation, proximity to higher institution and environmental characteristics

may have significant impacts on rent (Bello, 2000).

Presence of infrastructures such as water, electricity, adequate waste disposal system, sewage,

roads and drainages amongst others has great influence on the quality of the neigbourhood.

Bjorklund (1999) studied rental value between 1990 and 1997 in Stockholm from an investor’s

point of view. On the other hand Jeong, and Kim (2009) used a time series analysis and a shock-

response analysis of the Vector auto regression (VAR) model to find the trends in retail rents in

South Korea.

Jim & Chen (2006) observed that key neighbourhood factors influencing housing prices in China

are presence of green spaces and proximity to water bodies. Similar study in Taiwan by Chun-

Chang et al. (2013) revealed that in-house environment, security, neigbbourhood quality, sports

and leisure, have more impact on residential satisfaction within the area. As such, household will

be willing to pay more for property in the area where they can best obtain maximum satisfaction.

Chang & Lin (2011) adopted a hierarchical linear modelling approach to establish the

relationship between neighbourhood characteristics and house price in Taipei, Taiwan. Findings

from the study indicate that apart from other physical characteristics, neighbourhood attributes

particularly the quality of the environment and the availability of sports and leisure facilities

have the most significant impact on house prices in the study area. Residential property values

could also be enhanced by the presence of tree shades in a neighbourhood, which may give rise

to certain benefits to those residing in the property including additional privacy and aesthetics

(Bello & Yacim, 2014). Islam (2012) examined a set of neighbourhood characteristics to
determine how they influence house prices in the city of Edmonton, Alberta, Canada. It was

found that among the several variables tested, the level of household income and adjacency to

ravines are the most significant variables that influence house prices positively. It was noted that

although crime rate has a negative impact on house price, the impact is negligible. A study by

Hite et al. (2001) analyzed a combination of some structural, locational and neighbourhood

attributes' effect on property values as well as property taxes. The study paid special attention to

some environmental dis-amenities especially the presence of landfills close to residential

properties. The results show that proximity to landfills has more significant negative effect on

property values than on property taxes. It also suggests that closing landfills will not necessarily

eliminate property-value impacts. In other words, both open and closed landfills will exert

negative impact on property values. Related studies in Nigeria revealed that accessibility, rent,

and transport improvement, quality of neighbourhood, infrastructural facilities and government

regulations are factors influencing land value in Lagos Metropolis (Olayiwola et al, 2005).

Olayinka et al. (2013) observed that proximity to the major transport route, number and size of

bedrooms, conveniences, good access roads and drainages and security are the major factors

affecting property values within Magodo neighbourhood in Lagos State. Similarly, Oduwaye

(2009) maintained that cost of land has direct bearing on the quality of development in any

neighbourhood. The researcher observed that residential land values are high in the low density

areas and lower at the high density areas of Enugu state. Famuyiwa & Otegbulu (2012) attributed

increase in property rental values to availability of water infrastructure within a neighbourhood.

A study by Akinjare et al. (2011) also revealed that property values rise with increasing distance

from landfills while property located close to the landfills experienced reduction in value in

Lagos State. However, Udoka (2013) identified curb appeal (first thought that people have as
they are driving by a property), neighbourhood quality, presence of infrastructural facilities and

the economic situation in a place as major factors influencing property value. Again,

accessibility was identified by Alimi et al. (2014) as major factor influencing what household

will pay as rent in a particular location. The relationships between neigbourhood quality and real

property value cannot be undermined as it is evident that household will prefer to stay in a good

neigbourhood where they can enjoy maximum benefit in relation to rent or land value expended.

Ankeli et al (2016) examined the impact of housing infrastructure on the rental values of

residential properties in Oshogbo metropolis. Questionnaire survey was used to obtain data from

the study area. Oshogbo metropolis which is the study area was divided into four residential

zones. A total of 450 questionnaires were administered on the respondents using systematic

random sampling techniques, the data obtained were further analyzed with the aid of both

descriptive and inferential analytical techniques. The study revealed that properties with better

conditions in terms of infrastructures and physical soundness command higher rental values in

the study area.

Mbachu and Lenono (2017) examined the factors affecting the market values of residential

properties in the Johannesburg central business district, it is somehow exceptional to the previous

studies. The study made use of descriptive survey method. The survey involved both qualitative

and quantitative data gathering with the use of unstructured interviews and structured

questionnaire respectively. Content analyses and multi-attribute methods were employed in the

analyses of the research data. The results of the study showed that location, market conditions,

micro and macroeconomic dynamics, planning or building regulation, nature of interest, time

value of property, property design, property size, property yield and building features are the
most influential factors affecting the market values of residential properties in the Johannesburg

central business district.

Iroha et al. (2014) conducted a study on the trends in rental values of residential and commercial

properties in Akure, Ondo, Nigeria. The study was cross-sectional, and employed Survey method

through the use of questionnaire as the primary source of data. The population of the study was

22 Estate Surveying Firms, representing all of such firms in the study area. Descriptive and

inferential statistics were employed, with specific adherence to Simple Linear Regression,

Analysis of Variance (ANOVA) and Turkey post-hoc test. The study found that purpose-built

office spaces generated the highest returns as obtained from trend in rental values over time. The

study recommended that purpose-built offices hold the highest potential for quick recoup of

investment capital.

Research by Chukwu et al. (2016) adopted Survey method in a comparative determination of the

“trends in rental values of residential properties in the Achara Layout and New Haven”

neighbourhoods of Enugu State, Nigeria. The longitudinal study employed a “sample of 50

properties and 455 respondents” which were accessed using Stratified Random Sampling

Technique. Data were analyzed using ANOVA, and findings revealed a “steady increase in

rental value of residential properties in Enugu over a 10-year period. In comparative terms, the

study found that the rental growth rate of residential properties was higher in New Haven than in

Achara Layout. The study concluded that the neighbourhoods hold a potential of steady increase

in rental growth rate, and therefore recommended that new layouts be opened to further expand

increased private sector participation in the market.

Dabara & Oyewole (2015) examined the trend in rental and capital values of residential

properties in Ibadan, Oyo State, Nigeria. The survey employed structured questionnaire in
primary data collection from a sample of 56 Estate Surveying and Valuation firms in the

metropolis. Over 2,072 properties were examined by the study. Weighted means and growth rate

determination formula were utilized in data analysis and findings showed continuous rise in both

rental and capital values of the selected properties throughout the study period.

CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Introduction
In this chapter, highlights of the research methodology that will be adopted for the study will be
as analyzed. It includes among other things, the basic research design to be adopted, the nature
and sources of data to be used, the basic instrument to be employed and the analytical techniques
to be applied. The chapter will also explain the statistical and analytical tools to be used for the
study.
3.2 Research Design
The major research designs that was adopted for this study is descriptive research design by the
use of survey method, and statistical research to be designed by the use of Relative Importance
Index (RII), Arithmetic and Geometric mean and Multiple Regression Analysis. To cover the
study area effectively, a field survey was conducted with structured questionnaires for the major
study population and anchored with semi-structured interviews for the secondary population and
other relevant secondary data.
3.3 Sources of Data
The source of data that was used in the study are primary and secondary data.
3.4 Study Area
Enugu is the capital of Enugu state in [Link] is located in the south-eastern part of Nigeria.
According to the official website of Enugu state, Enugu has a population of 5.6 million people
with a rough estimate of 2.9 million males and 2.6 million females as at the year [Link]
English is the official language in Nigeria, almost 89% speaks and hear English or pidgin
English in Enugu .The official language is Igbo which around 95% of the population speaks, and
4% speak in their local dialect it is predominantly a christen state with roughly 90% are orthodox
and close to 2% are [Link] is divided into17 local government area namely;
aninri,agwu,enugu east, Enugu north, Enugu south, Ezeagu, Igbo-etiti, Igbo-eze north, isi uzo,
Nkanu west, Nsukka, oji-river, Udenu, udi, and uzouwani .the name Enugu is derived from two
Igbo words Enuugwu meaning hilltop Denoting the city’s hilly geography. Enugu state span
across a total of 7,660.2 sharing borders with Abia state and Imo, Ebonyi, and Anambra state.
Enugu state is composed of roughly six built up area divided by stream, valley and the railroad,
much cut across the middle of the urban area. The main cities and towns are Enugu
city,Agwu,Agbani, Oji River,Nsukka,,and Udi.

According to the Nigeria national News, economically, Enugu state is predominantly rural and
agrarian, with a substantial portion of its working population engaged in farming, although
trading (18%) and service (12.9) are also [Link] the urban area trading is the dominant
occupation, followed by services. Enugu, the capital city of Enugu state, is approximately 2
driving hours away from Port Harcourt, where coal shipment exited Nigeria. Enugu is also
located within an hour an hour’s drive from Onitsha, one of the biggest commercial cities in
Africa and 2 hours’ drive from aba, another, another very large commercial city, both of which
are trading, center in Nigeria.

A small proportion of the population is also engaged in manufacturing activities, with the
most pronounced among them located in Enugu, Oji, Ohebedim and Nsukka. The state boasts of
a number of markets especially at each of the divisional headquarters, prominent of which is the
Ogbete Main market in the State capital, Enugu. There is also one of the largest grains market
East of the Niger, the Orie Orba Market which plays host to most farmers from the North Central
States of Benue, Kogi, Nassarawa and Plateau who use the market to dispose their produce for
consumers in South-East and South-Southern Nigeria. Every four days, grains and other farm
produce are found in large quantities and at highly competitive ([Link])
Figure 1: Location of Enugu in the map of Nigeria
(Source: [Link]
state_fig1_339642976/download)
Figure 2: The City of Enugu
(Source: [Link]

3.5 Population Study

The population for this study includes the tenants of residential properties in the selected
neighborhoods and practicing estate surveying and valuation firms in Enugu. The choice of
tenants as population for the study was due to their status as rent payers, so, they are fully
equipped to provide the needed data for the study. Also, registered estate surveying and valuation
firms were selected for the study due to their involvement in the active property market of
Enugu, Nigeria.
The population of the tenants was gotten from the Nigerian Bureau of Statistics demographic
household survey and projected to the year of study while that of registered estate surveying and
valuation firms was gotten from the Nigerian Institution of Estate Surveyors and Valuers
(NIESV) firms directory of Enugu state.
3.6 Sample Size Determination
The determination of a sample size for any survey is contingent on a whole lot of issues that
cannot be strictly answered as certain factors must be assumed or prescribed. Issues such as
required precision for the sample results, preferred method of analysis of results of the survey,
and the adequacy of the sample to measure all variables satisfactorily where more than one
variable is to be measured must be specified (Nachmias & JavaNachmias, 2017).
The sample size of the tenants was from the Nigerian Bureau of Statistics demographic
household survey and projected to the year of study while that registered estate surveying and
valuation firms will be gotten from the Nigerian Institution of Estate Surveyors and Valuers
(NIESV) firms’ directory of Enugu state.
The impracticability of studying every member of the population of study will inform the
adoption of a manageable number as sample size for the purpose of data collection. The
determination of sample size adopted the Taro Yamani formula was used for a finite or known
population. The formula is given as: n = N /1 + N(e)2
Where n = Sample Size
N = The Finite Population
e = Level of Significance (or limit of tolerable error)
1 = Unity (a constant figure)

Where; n = sample size

N = the finite population

e = 0.05

1 = constant
Therefore,
n= 48
1+ 48 (0.05)2

48
1+0.12

= 48
1.12
Sample size =42

3.6.1 Sampling Technique

The convenient sampling technique was used in the selection of neighbourhoods while the
sampling of residential property tenants was done using the simple random techniques across the
selected neighbourhoods. Furthermore, the simple random sampling technique was used again in
the sampling of estate surveying and valuation firms that will serve as respondents for the study.

3.7 Source of Data Collection

Both primary and secondary data was sourced for the purpose of accomplishing the study
objectives. Data for this study was collected through questionnaires, personal survey and oral
interviews which are the primary sources of data and past research works on related topics which
make up the secondary sources of data (Udo, 2004). The main instrument for data collection was
the questionnaire which was given out to selected respondents. Other research instrument to be
used was oral interviews. The questionnaires was retrieved and analyzed.

3.8 Description of Research Instrument

The major instruments that was used for the study was sourced primarily through questionnaire
survey and personal interviews.
3.8.1 Questionnaire Administration

This contains a list of questions design to elicit information from specific target respondents. The
questionnaire was divided into four parts. The opening part started with a letter of introduction
which seeks to explain the study’s objective to the respondents and solicit for their cooperation
and ends with a commitment to maintaining respondent’s confidentiality for participating in the
survey. The second part contained the first set of questions addressing respondent’s attributes
with the aim of determining their profile hence suitability of the respondent for administering the
questionnaire. The third part in like manner was addressed to the respondents practice firm to
establish the firm’s age, staff strength, scope of activity etc. to determine their areas and extent of
involvement in the management and valuation of residential properties. The last part of the
questionnaire comprised of direct questions on the study specific objective comprising questions
directed at the study specific objectives. The questionnaire was closed with a final salutation and
an expression of willingness to share the findings of the study with respondents who wish to
know the outcome of the study by requesting them to fill their email addresses in boxes that was
provided at the end part of the questionnaire. The questionnaire adopted a close ended questions
format for respondents and their firms’ description with respondents being required to select one
from specified options, and in some cases they might be permitted to choose multiple responses
to a query. For the objective-specific part of the questionnaire, a combination of single and
multiple response question, opinion rating (likert-style) questions , and ranking (measuring
direction of expressed attitude) questions was given. This style suggested by reviewed literature
was used to test respondent’s perception of the measurement attributes.

3.8.2 Interviews

Further information for this work was gotten through interviews with tenants and Estate
Surveyors and Valuers with direct interface with Associates and Fellows of the Nigerian
Institution of Estate Surveyors and Valuers in the study area especially in the area of past
valuations carried out. The process involved first identifying specific surveyors with
responsibility in estate practice, scheduling interviews and holding the interviews. The
interviews was done through structure questions which was recorded by both writing and
electronic media. The interviews was auto-taped and later transcribed into narratives. The
duration span were between 15 and 50 minutes and covered specific issues relating to the impact
of neighborhood quality on rental trend of residential properties in Enugu, with a view to
providing information that will aid investment choices in the study area.

3.11 Data Analysis Technique

Data collected from questionnaires, interviews, personal observation, etc was be analyzed using
frequency tables and simple percentages. These tools were also used in the description of data.
However, the inferential statistical tool that was used for this study were arithmetic mean,
geometric mean, relative importance index (RII) and multiple regression analysis.
Multiple regression [Link] perhaps the most useful of all the inferential statistical tool. It is
used to describe and measure mutual and nature of the association or relationship between two or
more variables.
The general formula for the computation of “r” Test is given as:
Y = a + bx + €
Where Y = Dependant variable
x = Independent variable
b = Slope which equals change in Y all over change in x = (dy)
(dx)
€ = Error term or total error in estimating Y
a = Regression constant or intercept.