A property index is an essential tool not only to provide a comparative measure for the
performance of a portfolio but also for the analysis and drawing of conclusion affecting
the future management of the portfolio. This performance measurement tool has been
created and controlled by different property investment bodies around the world amongst
which includes RAAD VOOR ONROERENDE ZAKEN (ROZ) the umbrella
organization of the Dutch property industry, INVESTMENT PROPERTY DATA BANK
(IPD) responsible for U.K, South Africa and some other countries and NATIONAL
COUNCIL OF REAL ESTATE INVESTMENT FIDUCIARIES (NCREIF) responsible
for United State of America. The creation of a property index has brought transparency
and standardization into the user’s property market, performance measurement is easily
done with other asset class, investment decision are taken with accuracy and it also
provides an important benchmark against which performance of the managers of different
property portfolio can be measured i.e.in U.K, USA, South Africa and Holland. Four
major Conditions are required to be in place for the creation of a property index. These
conditions were used to benchmark with the situation currently in place in the Nigerian
property market.
A total of 40 questionnaires were administered to five categories of real estate investors
in Lagos and Abuja and a total of 28 questionnaires were retrieved back. Analysis of the
data was done with the use of tables and percentages while presentation was done with
the use of bar graphs. The findings from the data analyzed reveals that the Nigerian
property market does not have in place the conditions required for the creation of a
property index.