Assessing the Incidence, Characteristics and Causes of Economic Obsolescence in Residential Properties– a Case Study of Ibadan Metropolis

Abstract

The study examines the incidence, characteristics, and drivers of Economic Obsolescence (EO) in the residential property market of Ibadan, Nigeria. Economic obsolescence, unlike physical obsolescence, refers to externally induced depreciation that reduces property performance despite satisfactory physical condition. Ibadan provides a relevant case due to rising vacancy rates and declining rental values across several neighbourhoods. Guided by real estate literature, the study adopted a quantitative approach targeting Estate Surveyors and Valuers (ESVs), who are directly involved in managing and valuing residential properties. Using a non-probability convenience sampling technique, 110 structured questionnaires were administered, and 77 were duly completed, yielding a 70% response rate. The instrument captured respondents’ demographic and professional attributes, the incidence and nature of economic obsolescence in their portfolios, and their perceptions of underlying causes. Data were analysed using descriptive statistics, frequency distributions, the Relative Importance Index (RII), and the Criterion Importance Score (CIS). Inferential analysis (ANOVA and LSD post-hoc tests) was conducted to examine perceptual variations among respondents. Findings show that fewer than 20% of properties exhibit each identified EO characteristic. The most prominent characteristics include the collapse of social amenities (RII = 0.269), poor road and drainage infrastructure (RII =0.253), and oversupply of similar property types (RII = 0.247). Locational disadvantage ranked as the most critical causative factor, followed by insecurity and infrastructural decay. The study recommends coordinated urban renewal, targeted infrastructure upgrades, improved security, and responsive local regulatory frameworks to mitigate economic obsolescence and enhance sustainable housing in Ibadan.