Professionalizing real estate agency practice in nigeria: issues and the way forward

Thesis Overview

<p> </p><p><strong>INTRODUCTION<br>1.1 BACKGROUND TO THE STUDY</strong></p><p>Professionalizing is derived from the term Profession/Professional. A professional connotes a person with a distinct competence for a specified function or discipline (Ojewunmi, 2005). Such a person would have been trained or has acquired the necessary training in that discipline to become a professional in that field. A professional exists within the context of a profession; a distinct discipline or career path with its own training, qualification and membership requirements and standards. It is in the bid to establish such standards that professional bodies exist to ensure that persons within its fold have the requisite training/qualification and also abide by its rules and ethical standards (Kuye, 1998). A professional in any field is a highly regarded person and is deemed to have a certain level of competence expected of a person in that profession.<br>Real estate agency is essentially a land based profession that deals with the business of buying, selling or leasing of interests in real estate, which may be land or buildings or interests therein. Practitioners of this trade are generally addressed as Estate Agents in our environment. Considering the importance of housing in mans hierarchy of needs and the huge deficit that exists in the housing sector in Nigeria, Real estate Agents generally play a very important role in the socio-economic life of the country. Generally a real estate agent is a person, who possesses the authority to act on behalf of another person with a view to establishing contractual relationship between his principal and a third party. The person, who employs the agent, is usually called the Principal. Several variants of real estate Agent/Agency exist (Olatunji, 2008).<br>The practice of Real estate Agency in Nigeria at present remains largely unorganized, unregulated and unprofessional. Apart from the Nigerian Institution of Estate Surveyors and Valuers that has set standards for its practice by its members i.e. Estate Surveyors and Valuers, the large majority of those who practice estate agency do so without the basic training in that field, without any certification or qualification, without any regulation and largely in an unprofessional manner (Gambo &amp; Ashen, 2012).<br>The practice is generally open to all comers and entry and exit are at the sole discretion of the person. Due to the lack of a central professional/regulatory body that will set minimum standards for entry, set standards for its practice, as well as ensure adherence to a code of ethics, most estate agents are generally on their own and quackery with its attendant consequences is very prevalent if not the order of the day (Gambo &amp; Ashen, 2012). A multiplicity of local estate agents Associations exists but these are essentially local bodies without the right structure, leadership or plan to advance the practice of real estate agency beyond the parochial interest of the founders or originators (Hemuka, 2002).<br>The effects of this present state of real estate agency practice in Nigeria are indeed too numerous to count. The major effects are that due to lack of regulation and requisite competence on the part of the practitioners, the consuming public has been on the receiving end of estate agents in terms of very poor services, fraudulent transactions and losses of income through the activities of dubious practitioners (Hunter, 1997). As a result of this, the public perception of the real estate agent is very poor. Real estate Agents are generally looked upon as persons, who engage in sharp practices and whom you have to deal with, with “all eyes” open. In view of this, the practitioners are not respected in the society. The very low level of respect for the practitioners has led to a situation where both vendors and landlords alike do not see the need to remunerate them appropriately, while the lack of standardization and regulation has led to both the landlords and the vendors turning themselves into agents. In most cases, multiple agents are appointed and owing to lack of standardized practice procedures it usually turns into a cut throat competition amongst them. The level of abortive work done by the average real estate agent is phenomenally high due to the non standardized practice procedure. The police, EFCC and other law enforcement agencies are after the real estate agents in the belief that a lot of money laundering is done through the acquisition of properties with illicitly acquired wealth (Olatunji, 2008).<br>To achieve professionalism in the practice of real estate agency in Nigeria, the right approach will be to work towards ensuring that Real estate agents are appropriately trained and certified to practice, establish standardized prequalification and registration protocols for the prospective estate agents, keep a register of all qualified and certified estate agents, enforce compliance to a code of ethics and practice through sanctions, institute and implement mandatory training programmes for practitioners, Institute appropriate professional indemnity insurance programmes for members, to ensure the protection of members of the public, set remuneration due to agents whether as single agents or cooperating agents, generally regulate the practice of estate agency, develop and project the practice of estate agency as a respectable brand that will continuously earn the trust of members of the public through quality service delivery of its members. It will also protect and defend the interest of practitioners.<br><strong>1.2 STATEMENT OF THE PROBLEM</strong><br>Real estate agency practice in Nigeria like other countries of the world contributes massively to housing delivery system as it helps to meet as well as cater for the housing/accommodation needs of people. Due to the important roles real estate agents play in the housing and accommodation delivery sector of the economy, so many people have become victims of accommodation fraud from the hands of some of these estate agents who go about duping genuine accommodation seekers which has been the reason for calls from many quarters on the need to professionalize the profession in Nigeria. Professionalizing real estate agency in Nigeria will benefit not just the consuming public but also the practitioners. While the public will benefit through improved or quality agency services from reliable and well referenced real estate agents, the practitioners will benefit through proper regulation of the practice, which will ensure that only qualified and certified persons practice the trade and that the practitioners are appropriately trained, equipped and remunerated.<br><strong>1.3 OBJECTIVES OF THE STUDY</strong><br>The following are the objectives of this study:<br>1. To examine the issues involved in the professionalizing of real estate agency practice in Nigeria.<br>2. To determine the way forward for the professionalizing of real estate agency practice in Nigeria.<br>3. To analyze the factors hindering the professionalization of real estate agency practice in Nigeria.<br><strong>1.4 RESEARCH QUESTIONS</strong><br>1. What are the issues involved in the professionalizing of real estate agency practice in Nigeria?<br>2. What is the way forward for the professionalizing of real estate agency practice in Nigeria?<br>3. What are the factors hindering the professionalization of real estate agency practice in Nigeria?<br><strong>1.6 SIGNIFICANCE OF THE STUDY</strong><br>The following are the significance of this study:<br>1. The outcome of this study will be of benefit to the government and its agencies in that the practitioners of the trade will be brought under one umbrella, which will make easier the regulatory work of such government agencies like the EFCC in its fight against money laundering.<br>2. The result will educate the general public on the need to patronize the professional real estate agents and what criteria makes someone a real estate agent e.g. qualifications and the professional body the real estate agent belongs to.<br>3. This research will also serve as a resource base to other scholars and researchers interested in carrying out further research in this field subsequently, if applied will go to an extent to provide new explanation to the topic.<br><strong>1.7 SCOPE/LIMITATIONS OF THE STUDY</strong><br>This study on professionalizing real estate agency in Nigeria; issues and way forward will cover the activities of real estate agency practitioners in Nigeria considering professional ethics and code of conduct.<br>LIMITATION OF STUDY<br>Financial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).<br>Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.<br><strong>1.8 DEFINITION OF TERMS</strong><br>Profession: a paid occupation, especially one that involves prolonged training and a formal qualification.<br>Ethics: moral principles that govern a person’s behaviour or the conducting of an activity.</p><p>REFERENCES<br>David P. Hunter (1997). Professional Ethics and the Real Estate Agent. Illinois Real Estate Letter Fall<br>Fong-Yao Cheng (2008) Client Influence on Valuation: Does It Matter? A Comparative Analysis between Taiwan and Singapore. The 14th Annual Conference of the Pacific Rim Real Estate Society, Kuala Lumper, Malaysia.<br>Gambo, M. J. and Ashen, M. J. (2012). Application of Economic Indicators in Predicting Construction Cost Escalation for Residential Buildings in Nigeria. International Journal of Economic Development Research and Investment, 3 (1), 27-32.<br>Hemuka N. (2002). Ethical Behaviour and the Practice of Real Estate Surveying and Valuation in Nigeria.<br>Kuye Olusegun (1998). Ethical Behavior and the Practice of Estate Surveying and Valuation in Nigeria. John Wood Ekpenyong Annual Lecture Series.<br>Makanjuola Ojewumi (2005). How to Make Huge Profits in Estate Agency: 21 Lessons that Sharpen and Shape You. Knight Service Books, the Pent House Suit, Greenfield Plaza, Ibadan, Nigeria<br>Oluwole Alfred Olatunji (2008). Assessing Client’s Confidence and Satisfaction in Construction Professionals in Nigeria. Journal of Environmental Science, FUTA.</p> <br><p></p>