Exchange Rate and Housing Deficit Trends in Nigeria: Descriptive and Inferential Analyses

Abstract

Among all possible strategies advanced by policymakers, researchers and practitioners towards resolving housing deficit, macroeconomic strategy remains underexplored. In this chapter, archival data from 1960 to 2019 were used to explore the dynamics between macroeconomic variables and housing development in Nigeria. Specifically, the chapter examined the linkage between exchange rate and rental values. The investigation involved both descriptive and inferential analyses, with the aid of Pearson Product Moment Coefficient in SPSS and Pivot graph in Excel. Results from the descriptive analysis revealed that exchange rate and housing deficit in Nigeria from 1960 to 2019 shared similar trends in stability and volatility. On the other hand, results of the inferential analysis showed a strong positive significant correlation between the naira-dollar exchange rate and housing deficit, at r (60) = 0.924, p < 0.0001, with exchange rate contributing 92% of the variation in housing deficit. These results agreed with previous studies claiming that aggregated macroeconomic indices influence the real estate sector. Thus, Nigeria should employ exchange rate as a catalyst to stimulate housing development and resolve housing deficit.KeywordsExchange ratesHousing deficitHousing developmentMacroeconomic variablesRental values