By Adejumo Kabir
One of the 15 topmost Professors of Estate Management in Nigeria, Professor Olusegun Adebayo Ogunba of Obafemi Awolowo University, Ile Ife has identified unprofessional conducts and growing inaccurate evaluation of properties as major challenges confronting Real Estate Development in Nigeria.
Prof. Ogunba while delivering the 303th inaugural lecture series of OAU with the topic: “New Wine In New Wineskin: Travails In The Enhancement Of The Appraisal Of Real Estate” held at Oduduwa Hall today said part of the real estate management catastrophic is unreliable and inconsistent appraisal.
According to himthe profession deserves appropriate practices with strict enforcement of professional rules and standard not to be in transit to irrelevant anachronism.
Prof. Ogunba who presented the inaugural lecture under the chairmanship of the new Vice Chancellor, Prof. Eyitope Ogunbodede said his research more concern in addressing problems in the profession of the estate surveyor and valuers.
Ogunba who emphasised the enhancement of the accuracy of valuation through risk analysis said “Valuations as presently conducted are not inaccurate, but also deterministic, that is, they provide single figure estimates of value. Part of the implications of inaccuracy of valuations estimates is fraught with downside risk.
“Many clients – for example pension funds or banks – are very risk averse. Such investors cannot realistically cope with a high level of disparity between valuation estimates and actual realised prices. Part of the solution to this situation is to apply risk analysis of valuations estimates. Risk analysis can provide a range of possible valuation estimates and the probability of achieving each estimates.”
He also said cost valuations cannot rationally be appropriate for the valuation of properties where the value concept is market value.
“If one were asked to value, for instance the staff of Oranmiyan in Ile Ife, or the sacred trees of eastern Nigeria for compensation purposes, the market based on the approaches of the estate surveyor and valuer breaks down because there is no direct or indirect market for cultural heritage of this kind.
“The usual resort of the valuation surveyor when faced with no-market is to the replacement cost approach. However, it would be completely absurd under these circumstances to assume that the heritage property can be valued using replacement cost”, he said.