The Income Elasticity of Demand in a Sub-Saharan African Housing Market: Evidence from Ibadan, Nigeria
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Abstract
Very little is known about the behaviour of housing demand in sub-Saharan housing markets. This ostensibly is due to the dearth of such studies in this region. In this paper the author estimates the parameters of the demand for housing, using data drawn from the city of Ibadan in Nigeria. The empirical analysis, in which housing is viewed as a composite product, reveals that the demand for housing is income inelastic. Specifically, income-elasticity estimates for renters and owners are 0.88 and 0.56, respectively. Furthermore, these income-elasticity estimates were found to be higher than those reported for other African cities.