Background of the Study
Housing development is critical for improving living standards and stimulating economic growth. In Nigeria, the housing sector faces challenges such as high construction costs, inadequate financing, and urban population pressures. FDI has the potential to influence housing development by introducing advanced construction technologies, expanding access to capital, and fostering public–private collaborations that can address housing deficits (Ibrahim, 2023). Foreign investments may lead to improved quality, affordability, and sustainability in housing projects by leveraging international expertise and best practices. Furthermore, FDI can spur job creation in the construction sector and related industries, thereby indirectly boosting demand for better housing (Afolabi, 2024).
This study investigates how FDI inflows affect housing development initiatives across Nigeria. It analyzes the extent to which foreign investment contributes to increased housing supply, quality improvements, and affordability. The research examines various channels, including direct investment in real estate projects and indirect influences through technology transfer and enhanced financing options. By reviewing macroeconomic housing data alongside qualitative case studies from urban and peri-urban areas, the study aims to assess the effectiveness of FDI in bridging the housing gap and promoting inclusive urban development (Chukwu, 2025).
Statement of the Problem
Nigeria continues to experience a significant housing deficit despite periods of economic growth and rising foreign investment. Although FDI is expected to facilitate improved housing development through increased capital availability and technology transfer, the outcomes have been uneven. Many housing projects remain unaffordable or poorly executed due to factors such as bureaucratic bottlenecks, high input costs, and a lack of integrated urban planning (Ibrahim, 2023). Consequently, the potential for FDI to transform the housing sector is hindered by systemic constraints that limit its effectiveness in delivering sustainable, affordable housing solutions (Afolabi, 2024).
Objectives of the Study
To examine the impact of FDI on housing development indicators in Nigeria.
To identify the channels through which FDI influences housing supply and quality.
To propose policy interventions that enhance the role of FDI in addressing housing deficits.
Research Questions
How does FDI affect housing development in Nigeria?
What are the primary mechanisms through which FDI influences housing outcomes?
What policy measures can improve the positive impact of FDI on the housing sector?
Research Hypotheses
FDI inflows are positively correlated with increased housing development when complemented by supportive regulatory policies.
Technology transfer and improved financing mediate the impact of FDI on housing quality.
Targeted public policies can enhance FDI’s role in mitigating housing deficits.
Scope and Limitations of the Study
The study focuses on housing development and FDI data from 2020 to 2024 across urban centers in Nigeria. Limitations include variability in regional data and challenges in measuring informal housing market activities.
Definitions of Terms
Housing Development: The process of constructing and improving residential infrastructure.
FDI: Investment by foreign entities in domestic housing projects.
Technology Transfer: The dissemination of technical knowledge from foreign to local firms.
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