Abstract

In the midst of the tripartite essential needs of mankind is residence, often called shelter. This inevitability of man, which is affordable through real property development, is money exhaustive and entails huge and enormous finance which is, as a general rule, beyond the accomplishment of equity capital; consequently, the inevitability of borrowing to finance housing development. Nevertheless, this “supposed to be” complement of equity capital has proved insufficient and unsuccessful over time, owing to interest, non-affordability, stringent and rigorous repayment requirements and others, in financing housing developments in Nigeria. The purpose of this investigation is to appraise and assess the perception and opinion of real property developers with reference to conventional borrowing and its attendant consequences and repercussion in financing housing developments with a view to uncover the potentials of ‘Sukuk’ as an alternative source of financing housing developments in North-Eastern Nigeria. Based on the findings of existing literature, it is sufficed to state that the performance of conventional financial institutions in financing residential developments is very low; developers’ perception about conventional borrowing and its associated terms considerably influence their intention and decision to borrow in financing residential developments; developers have high preference for ‘Sukuk’, when obtainable, than conventional source of financing residential developments. This research would provide the foundation whereupon policy makers would evaluate and appraise the existing financing strategy to mirror the desires, yearnings, aspirations and diversities of all citizens; it would expose the gap in financing residential developments, thereby providing both local and international investors the opportunity to tap from unutilized investment opportunity; it would also provide the basis for solving the seemingly intractable residential development financing problems in Nigeria. This research would be the first to evaluate real estate developers’ perception on borrowing in financing residential developments in North-Eastern Nigeria and probably the first to apply the theory of planned behavior in the field of real estate development financing, at least in Nigeria.

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