1. Introduction
The real estate industry is vital to the modern economy. The real estate market is the market that encompasses all transactions that involve dealing in rights or access to land and buildings [
1]. It forms the backbone of the urban economy, being a fixed factor market; hence, an efficient real estate market is most important for a well-functioning urban environment. This implies that countries cannot create wealth without real estate or be wealthy without possessing it [
2]. Real estate has also been found to have relative impact in various economies, including developing nations such as Nigeria and developed nations such as the UK [
3,
4]. According to Minguzzi [
5], real estate helps boost the modern economy in the following four ways: Firstly, it enables economic activity through the production and supply of space for industry and business. Secondly, real estate secures employment provisions for professionals, artisans, and other workers. Thirdly, it complements and supports the government’s infrastructure policy through real estate development. Lastly, real estate provides an investment outlet for institutional investors to maximise returns on investible funds. Real estate investment has become “the largest asset class globally” in terms of value [
6]. Savills World Research [
7] considers that global real estate is a more valuable asset class than all stocks, shares, and bonds combined and reveals that the driving force behind the growth that has made property most importantly sought after is the investment funds.
Due to the increasing demand for land and its unavailability in desirable places, citizens gravitate to different areas, including those prone to flood risk. This suggests that people do not see flooding as a barrier to urban growth and expansion. Adebimpe et al. [
8] termed flooding an overflow or retention of water in a normally dry area. In this study, the flood-risk areas are described as hotspots. Therefore, a place that regularly experiences flooding can be termed a “
flood risk hotspot”. The occurrence of flooding in such an area could be attributable to the overflowing of rivers, natural waterways, and surface runoff [
9]. The increasing frequency and severity of rainfall due to climate change has contributed to the persistent rise in flooding events [
10]. The impact of flood events in recent times has arguably been unprecedented worldwide. These incidents have caused deaths, injuries, and property losses [
11,
12,
13]. Flooding has also been found to be seasonal, as Etuonovbe [
13] added that the rainy season is not the best time for the inhabitants of Lagos. This period is characterised by persistent flooding, which submerges several houses, resulting in damage and, in some cases, death. The various forms of flooding that occur in the state include tidal, river, flash, drainage, sewage, urban, and pluvial [
13]. According to Aderogba [
14], the primary factors contributing to flooding in all local government areas of Lagos include canal blockages, insufficient drainage infrastructure, heavy rainfall, and encroachment.
The global problem of flood events is becoming more severe due to climate change and population drift. Incidents of flooding that wreak havoc on the urban infrastructure are now commonplace. According to research, various types of floods are triggered and aggravated by natural and manmade activities within a given environment. Examples include tidal, pluvial, sewers and drains, groundwater, fluvial, and those from manmade activities [
14,
15,
16,
17]. Flood incidents can, therefore, be classified according to type, causes, and the extent of the damage. According to Brockhoff et al. [
10], most areas experience flooding after downpours due to their impervious surfaces and rapid urban expansion in many flood-prone areas. The impacts are common to both developed and developing countries. This is true for the present study area, as flooding is a common phenomenon after downpours in most locations in Lagos, Nigeria. The criteria for defining flood-risk areas could vary by country. However, it is noteworthy that factors such as the frequency and magnitude of flooding, land elevation, proximity to water bodies, the presence of floodplains, and the level of development in an area could contribute to the flood risk of the area. As put forward in this study, the flood-risk areas are those that (i) regularly flood whenever it rains, (ii) are within the proximity of water bodies, and (iii) are defined as at high risk of flooding by the Nigerian Hydrological Agency due to the historical background of those areas.
Flooding affects more properties than any other environmental hazard and hinders sustainable development [
18,
19]. Over the last two decades, Nigeria’s urban population has grown exponentially [
20,
21]. The upsurge in population has increased the demand for housing [
22]. Additionally, it has increased the demand for property and generated much pressure on land, infrastructure, and social services. Flooding has been more common in some areas of Nigeria in recent years due to the rising urbanisation pattern and the increasing number of metropolises without adequate planning and drainage facilities [
23,
24,
25]. A study on the review of Environmental Impact Assessment (EIA) noted that hazards such as flooding could impact sustainable development [
25], which could include key aspects of valuation, such as depreciation and appreciation of property values. The effect on property prices in the affected natural disaster area could further be explained by the categories of property strata, housing, and landed property [
26]. However, Basu et al. [
27,
28] concluded that with the growing rate of urbanisation, the presence of trees can influence the quality of the environment and, in turn, aid in flood control.
Ayoola et al. [
29] also modelled the externalities necessary for assessing residential property values. The value assigned to a property is contingent upon the existence of several distinct bundles of characteristics [
30,
31]. In coastal environments, for instance, a recent literature review considered the effects of flooding on residential properties, reflecting different models for determining its values [
32]. In all, the peculiarity of the stakeholders engaged in the real estate market and the heterogeneity of real estate assets might be attributable to the varied values assigned to real estate property interests [
33]. This means that people make choices, and the decision-making method is often particular to the issue at hand. While some options are simple and seemingly straightforward, others are difficult and involve a multistep decision-making process. How people perceive and decide about risk is a complex phenomenon [
34]. No widely agreed framework embraces all real estate investment decision-making features, although, over time, many of its facets have been established and investigated [
35,
36,
37,
38]. Continued residential property investment in areas prone to flood risk calls for examining the factors that are responsible for continued property market activity, and whether the combination of these factors supersedes the risks associated with investing in residential properties in these environments. External and internal sources could influence individuals’ decision-making behaviours. The factors could include prior experience, awareness of flood duration, and socioeconomic, situational, and geographic variables [
39,
40,
41,
42].
The analysis of the influencing factors and other issues that arise from the findings of the present study form the basis for a decision-making guide for residential property investors. Therefore, to examine the investors’ decision-making behaviour in this present study, it was important to establish the drivers that could motivate property investment, with a view to understanding their perceptions of risk considering the impact of flood risk on the environment. This study therefore aims to understand and explain the factors that influence investors’ decisions in investing in property in areas with the likelihood of pluvial flooding, using Ibeju-Lekki and Ikorodu—two notable local government areas susceptible to pluvial flooding in Lagos State, Nigeria—as a case study.
2. Determinants of Investment in Flood-Risk Areas
The research about risk perception will help in understanding how choices are made. The perception of risks is multidimensional (rational and emotional) in nature [
43,
44], combined with the perceived likelihood and anxiety associated with it [
45]. Researchers have shown that risk characteristics can be grouped into two dimensions: cognitive and emotional [
46,
47]. Humans often deviate from rational behavioural norms [
48,
49]. Slovic [
50] states that when people choose natural hazards, they rely on intuitive risk perceptions. Individuals’ perceptions influence their decision-making behaviour. Theories have been developed to understand how people make choices and the reasons for those choices. Juliusson et al. [
51] suggested that previous choices may influence subsequent ones. When something positive results from a decision, people are more likely to decide similarly when facing a similar situation. On the other hand, people tend to avoid repeating past mistakes [
52]. This is because future choices made based on past experiences are not necessarily the right choices. This approach conflicts with what one may expect (see Ref. [
51]).
People’s beliefs about natural hazards can influence risky investment decisions [
53]. More precisely, a person’s perception and assessment of the possibility of floods would likely determine their attitude toward investing in an area delineated as at risk of flooding. Solomon and Qin [
53] asserted that increased public perception of floods could be attributed to the environmental effects of climate change. However, human expectations and reactions to threats are complex [
54]. Investment motivations and subsequent decisions are affected by various determinants, which make the process dynamic, complex, and difficult.
Numerous variables may also contribute to influence the decision to invest in real estate. These variables could be classified into environmental, neighbourhood, accessibility (location), and property (structural) variables [
55]. Sean and Hong [
56] delineated the variables that could influence property investment decisions in Malaysia, into neighbourhood, financial (economic), structural, and locational factors. According to Wong et al. [
57], the value attributes assigned to investment decision-making would be influenced by the property’s physical characteristics (e.g., structure, size, and design of the property) and neighbourhood characteristics (e.g., distance to schools, malls, parks, markets, and the rate of crime risks). Maleki and Zain [
58] discovered a strong association between housing prices, environmental facilities, and property design (structural). The present study identified variables that have been shown to impact property investment decisions in general and assessed whether they could also motivate investment decision-making and contribute to investment in areas susceptible to flooding.
Due to the susceptibility of flood-risk areas, it can be said that a thin line demarcates areas at risk of flooding and those that are not. This is because an area might be flooded overnight despite not being designated as a floodplain. Studies have investigated factors that could influence property investment decisions. These studies are mainly focused on non-flood-risk areas. There is a dearth of research and information on those factors that could inspire investment in flood-risk areas—especially in Lagos, Nigeria. This research gap needs attention considering the growing threat of floods, climate change, the constant demand for land and landed property, and the need for sustainability. In order to address this problem, this study examines how knowledge and experience of flood risk can influence private investors’ (i.e., homeowners and renters) decisions on property investment selection in areas that are at risk of flooding. Additionally, the study explores how well estate agents understand the needs of private investors whenever they are approached for property investment transactions. This is necessary to ascertain their expertise in terms of comprehending their clients’ decision-making behaviour.
4. Results and Discussion
The results from the field survey were computed using the mean and standard error to show the respondents’ perceptions on the topic of interest. The computed mean and standard error depicting the respondents’ (private investors and estate agents) perceptions are given in
Figure 5 and
Figure 6. These results summarise their responses to comments on motivating factors that could influence investment decisions, particularly when the areas have the potential risk of flooding. The mean values for the variables investigated from the purview of the private investors ranged between M = 4.74 (SD = 0.470; 0.525) and M = 2.44 (SD = 0.998), with a variance of 2.30. Based on the evaluation indices set out in the
Section 3.6, the combination of the total variables investigated reveals that from the purview of the private investors, 8 of the factors were recorded as most significant, 22 were significant, and 7 were moderately significant, while none was deemed insignificant in influencing property investment decisions within the surveyed flood-risk areas (see
Figure 5(ia–iiia) and
Figure 6(ia–iiia)). In the same light, the estate agents’ perceptions about what could inspire private investors to invest in flood-risk property were also examined. The mean values for the factors ranged between M = 4.76 (SD = 0.516) and M = 2.68 (SD = 1.035), with a variance of 2.08. Based on the evaluation indices, 5 of the factors were considered “
most significant”, 28 were recorded as significant, and 4 were moderately significant, while none was deemed insignificant.
The findings in
Figure 5(ib–iiib) and
Figure 6(ib–iiib) highlight five variables that the estate agents believed that the private investors would consider when deciding to invest in areas with the potential risk of flooding. These variables had mean scores greater than 4.50 on a 5.00 scale. They included the property’s actual location (
F1), the probability that the actual location could be flooded (
F2), and the provision of electricity and other infrastructural supplies (
F12). Other factors within this group included the proximity/accessibility of transportation services (
F6) and the property’s neighbourhood road network (
F9). The group of factors that were considered in line with the private investors’ opinions were the property’s actual location (
F1), the accessibility of transportation services (
F6), and the availability of electricity and other infrastructural supplies (
F12). This may imply that these factors are very important and non-negligible in influencing residential property investment decisions. The investors agreed that these factors play a prominent role in driving their decisions, and the estate agents shared the same opinion on this.
From the mean results computed using the private investors’ opinions, the eight “most significant” factors included the availability of electricity and other infrastructure supplies (F12), the crime rate in the neighbourhood (F15), and the actual location of the property (F1). Others included the neighbourhood’s susceptibility to flooding (F13), the distance to one’s workplace (F3), the serenity of the neighbourhood (F10), the neighbourhood’s level of pollution (F16), and the proximity/accessibility of transportation services (F6). Private investors generally accepted that these considerations must be prioritised in order to make sound residential real estate investment decisions, particularly in a flood-risk zone. When the decision criteria were applied, the seven lowest-ranked variables were deemed to be “moderately significant”: behavioural influence (F35), the proximity of worship centres to the property (F5), future economic conditions (F27), financial preparedness to cope with flooding (F32), reliance on other people’s investment decisions (F29), psychological preparedness to cope with flooding (F30), and financial preparedness to cope with flooding (F31).
Moreover, the availability of electricity and other infrastructural supplies (
F12) ranked first (M = 4.74) as the most significant factor that could influence their property investment decisions. This demonstrates the critical role of infrastructure provision in determining the value attributable to property investments. According to Ihuah and Benebo [
91], the effective functioning of economic activities and the attainment of an environment’s development level rely on available infrastructural provisions. Since the private investors agreed and preferred to invest in flood-risk neighbourhoods with adequate infrastructural supply, one might argue that infrastructure is a necessary component of residential growth. This study corroborates Elliot’s [
92] assessment of infrastructure services’ impact on real estate for better or worse.
Figure 7 shows the plots from the perceptual analysis showing the ranking and mean for each variable considered.
The findings of this study, as shown in
Figure 5,
Figure 6 and
Figure 7, indicate that the private investors have slightly different preferences, ranking the neighbourhood’s crime rate (
F15) as the “
most significant” factor that could influence their investment decisions in a flood-risk area. This means that home-seekers and -owners who are investors would be willing to pay for or settle in a neighbourhood devoid of crime [
93,
94]. Moreover, Clark and Herrin [
95] reported that a high murder rate in a neighbourhood will negatively affect the return on property investment. This indicates that people put a high premium on security when making informed decisions about property investment. Based on the ranking of the most significant factors that could motivate investment decisions in flood-risk areas, this study’s findings placed the availability of electricity and other infrastructure supplies (
F12), along with the crime rate in the neighbourhood (
F15), ahead of the property’s actual location (
F1) (M = 4.69). This contradicts the widely held belief among real estate professionals that location is the primary determinant that encourages property investment decisions.
The private investors agreed that the distance to their workplace (
F3), with a mean value of 4.55, is one of the “
most important” factors that could motivate their investment decisions. Thus, this study’s findings corroborate the assertion of Topcu and Kubat [
96] that accessibility is a critical determinant of residential property values, based upon which decisions are made. Additionally, it supports Abidoye [
97] in that a homebuyer or tenant will consider the gap between their workplace and their residential home when determining where to live. This may explain why the majority of respondents preferred to remain in their current location despite the possibility of flooding. An additional reason could be that traffic congestion may result in lateness to work; hence, this contributes to choosing an area near their workplace.
The property market conditions (
F26), with a mean score of 4.19, were identified as another “
significant” factor that influences property investment decisions. This result is consistent with Thompson and Strickland’s [
98] and Zhang et al.’s [
99] findings that external factors such as changes in market conditions and the economic environment impact property’s market value. This suggests that the majority of the investors consider the state of the property market. Therefore, this study also supports the findings of Gallimore et al. [
93], as individuals’ convictions about property markets can influence their investment decisions. Lastly, the findings in the present study show sentiment (bias) regarding investment (
F28) and the level of risk awareness in investing (
F37) as moderately significant factors, as well as the reliance on other people’s investment decisions (
F30), psychological preparedness to cope with flooding (
F31), and financial preparedness to cope with flooding (
F32) being significant factors. The highest-ranked factor in that category was
F30 (M = 4.31), followed by
F31 (M = 4.15) and
F32 (M = 4.14). This shows that there is positive behaviour of the respondents towards decision-making to invest in these areas, as well as the need to understand the reasons for deciding to invest.
The radar charts in
Figure 7 show the ranking relationships and hierarchy of the various variables against the perspectives of the private investors and the estate agents in this study. This was carried out to use the relationships established from the radar charts to determine the elements that influence property investment in places that are prone to flooding. In spite of this, the plot has some relevance to the scope of the study, which seeks to understand the elements that influence the perceptions of stakeholders. However, this study is more in line with studies that explore the perspectives of non-experts.
Another important aspect of this study is the presentation of the perception mapping based on this investigation, showing the key considerations made. Sixteen of the twenty-two variables identified as “significant” by the private investors were rated equally by the estate agents: the proximity of shopping malls and/or markets to the property’s precise location (F4), the population density where the property is situated (F8), the neighbourhood’s topography or terrain (F11), the size of the building and/or land (F17), the size of the living and/or dining area (F18), the number of bathrooms within the property (F19), the property’s interior and exterior façades (F20), the property’s design and aesthetics (F21), the property’s age and condition (F22), parking space availability (F23), the number of rooms within the property (F24), comparison of the investment cost with its associated benefits (F25), the analysis of the market conditions (F26), emotional attachment and willingness to take risks (F33), attitude towards risk that is independent of financial circumstances (F34), and the risk level associated with the property’s location (F36). The responses of estate agents to the “moderately significant” variables indicated that of the seven variables defined as “moderately significant”, only the proximity of worship centres to the property’s precise location (F5) was in line with the private investors’ view.
5. Perceptions and Considerations
The input of stakeholders in the built environment, and the real estate sector in particular, is very important in decision-making, policymaking, setting industry practices, and the development of relevant standards [
90,
100]. Perception analysis is very important, as considered in various studies on investment decisions for residential areas [
26,
29,
39]. Thus, we also applied perception analysis in the present study and presented the considerations for decision-making. However, this plot gives bearing on the scope of the study, which aims to elucidate the factors that influence stakeholders’ perceptions, but more in line with studies that explore the perceptions of non-experts. Flood risk/susceptibility maps have been created using data-driven techniques or multi-criteria decision-support systems to investigate the link between flood risk and consumer/investor behaviour. Although the topic of identifying the most significant factors affecting investments in flood-prone areas is intriguing, it can be seen that the survey included many factors that were related not to floods, but to housing decisions. These factors include electricity and crime rates, which affect the house prices and residential location choices, and they are related to the study area. However, this study also shows the limitations of the perceptual analysis in considering that the respondents may have answered the questions as if they were participating in a survey for investments in normal conditions, rather than in a flood-prone area. As a result, it is important to add that future studies should recognise that flood-risk studies that are based on quantitative research that examines climatic, topographic, land-use, and anthropogenic factors should be carried out.
Another area of future research on flood-risk areas should be investigated to include other characteristics, including the physical characteristics of properties in natural disaster risk zones, such as materials, number of floors, slope, and drainage quality. However, it is noteworthy that the findings of this study are based on perceptual analysis, and the considerations include the locational, neighbourhood, structural, economic, behavioural, and risk factors. Since these points made were on the technical, professional, and safety recommendations, it is the stern advice of the authors to conclude that these flood-risk areas need to be categorised in future studies to identify the areas of high, medium, and low risk. In addition, the authors also discourage the decisions made by some people to reside along these flood-risk regions and coastal areas, due to some level of uncertainty and unpredictability of flooding. In other words, it is not advisable for people to willingly live in flood-risk areas, as the limit of flood risks can be high and can pose great risk in terms of loss of lives, loss of investments, and loss of properties. However, due to the increased technological advancements, there has been an increase in development in coastal regions, flood-risk regions, and on water, through the use of land reclamation, the use of floating building technologies, and the use of flood defence systems as protective structures. It is the authors’ view that property investors and stakeholders should conduct necessary checks before investing in these areas. The reason for the inclusion of non-flood-related factors was to assist the non-technical respondents (i.e., estate agents) in answering the survey questions and improve the relevance of the study for property investors who are not flood experts, as well as for those property investors who are experienced in challenging areas such as flood-risk areas, brownfield areas, high-crime areas, etc. In light of this, we applied perception analysis to the present study and suggested the factors that should be taken into consideration when making a decision. This study investigated how private investors feel about having to deal with floods in their everyday lives, as well as the factors that influence their investment choices.
Figure 8 shows the plot that was obtained from the perception analysis in the study, based on the relationship between private investors’ and estate agents’ perceptions on factors influencing investment decisions.
The findings of our perception analysis on the relationship between the two independent variables in
Figure 8 show that the six factors investigated have high interconnections. According to the perception plot, the highest determinants are the locational factors, followed by the neighbourhood factors. The plot also shows that behavioural factors have the highest bearing on the investment decisions for private investors, at 4.4, followed by the economic factors at 4.0 and the locational factors at 3.6. The plot also shows that neighbourhood factors have the highest bearing on the investment decisions for estate agents, at 4.6, followed by the economic factors at 4.0 and the locational factors at 3.6. It is interesting to note that risk factors are the least considered by the estate agents, as they will try to find tenants for various properties, as long as they will earn sales commissions. In that light, this study notes decision-making factors for investing in this area, but it does not direct investors to invest in flood-risk areas. The study also identified that there are reasons to make these decisions to invest in flood-risk areas, based on the survey conducted. Nonetheless, this study presents recommendations and professional advice to such decision-making approaches. This study was intended to determine the elements that affect property investment in flood-prone regions. In a nutshell, it is advised that the investors must ensure necessary due diligence by conducting feasibility studies, studying environmental data, assessing structural building plans, looking into flooding maps in the area, seeking expert opinions, and consulting flood consultants for EIA reports on flood-risk areas. It is pertinent that the right professionals are also contacted in making such investment decisions in these flood-risk areas. While it is understandable that real estate developers and real estate agents are not responsible for monitoring or estimating hazard risks, they make huge contributions in the built environment. However, it is noteworthy to add that flood mitigation decision-making and investment decisions in flood-risk areas are important for both the business analysis and the flood experts, but flood monitoring is mainly the job of scientific experts.
While it is impossible to avoid hazards, limiting development in hazard-prone areas can reduce harm. From the authors’ perspective, it is harmful to focus on the settlement process of flood-prone areas when the whole world is fighting to reduce the risk of flooding in cities as part of adaptation to climate change. Risk reduction must be ensured by informing residents about the threat, discouraging them from living in such areas, increasing urban retention through the development of green and blue infrastructure, and striving to move people away from the threat and not settling these places. Conversely, there are still people who prefer to reside in riversides, coastal areas, and other such flood-risk areas. Consequently, future research using similar surveys should also emphasize flood risks to provide more related factors, as well as the statistical analysis to validate the accuracy of the results, and respondents should be presented with a more detailed understanding of these risks in such surveys. Furthermore, future studies could be conducted by considering the stakeholders in the built environment as the study respondents, which would help with the recommendation to conduct a review of stakeholders’ propositions, e.g., regulation requirements, elaboration of standards, local/national coding requirements, implementation programs, maintenance, cost, and infrastructure requirements, etc.
The factors considered in this study are also based on the study area; as a result, the research results do not portray a generalised study but, rather, a case study approach; as such, they cannot be used in other places. This work briefly addressed the problem of the genesis of the flooding in the study area, with some discussion of the legal aspects of living in areas at risk of flooding in these parts of Lagos State, Nigeria. As such, residences in these flood-risk areas may also require some level of security and insurance for both lives and properties. There should be safety markers, the use of flood warnings, phone notifications for hazard warnings, and the use of loudspeakers at strategic locations in case of flooding or similar hazards. It is also recommended that there should be plans made in flood-risk areas for the evacuation of people and properties in the event of any imminent danger or suspected flood warnings in those flood-risk areas. As regards the justification for the present study, we identified some studies on the risks of flooding in different communities investigated by various researchers, which also conducted perceptual analysis of flood-risk areas. The use of cognitive mapping and flood modelling could also be conducted in making decisions on the assessment of flood-risk areas in future studies. Also, more mapping documents on other residential location choices (RLCs) can be digitised for flood-risk areas using map data like Mapz (
Supplementary Materials). Lastly, there should also be real-time access to hydrological and weather data for those residents in these flood-risk areas. Other recommendations are given in the following section.
6. Conclusions and Recommendations
This study investigated the factors that influence investment decision-making in flood-risk areas by examining two selected local government areas that are at risk of flooding during the rainy season in Lagos State, Nigeria. This was achieved through a questionnaire survey of private investors’ and estate agents’ opinions to fulfil the research objectives. The data were analysed using the mean item score for ranking and comparative assessment of the agreement analysis. The research findings provide insight into the perceptions of flood risk, shedding light on decision-making and the factors considered when making investment decisions. Thirty-seven factors that could influence investors to invest in flood-risk areas were identified from the literature and evaluated in this study.
The highlights of this study’s findings are as follows: First, people’s perceptions of risk can have a significant impact on their willingness to invest in flood-risk reduction measures. Second, people’s perceptions of risk can be influenced by a number of factors. This means that their perceptions of risk can vary widely, even within the same community. Third, people’s perceptions of risk can be inaccurate, because people often rely on heuristics, or mental shortcuts, to make decisions about risk. Hence, there could be a likelihood of underestimating or overestimating flood risk. Therefore, this research can help to identify the factors that may influence people’s willingness to invest in flood-risk reduction measures. By understanding how people perceive risk, investors can develop more effective strategies for promoting investment in flood-risk reduction measures. This can help to make the built environment more resilient to the impacts of flooding.
The results were categorised based on a new metric criterion. The 4.5 threshold on a 1–5 Likert scale was introduced as a metric to give a novel contribution to the decision-making criteria. Adopting the stated metric, the following was found:
- (a)
From the private investors’ purview, eight factors were recorded as the most important factors influencing property investment decisions in areas prone to flooding: F1 (the actual location of the property), F3 (the distance to the workplace), F6 (the accessibility of transportation services), F10 (the neighbourhood’s serenity), F12 (the availability of electricity and other infrastructural supplies), F13 (the susceptibility of the neighbourhood to flooding), F15 (the neighbourhood’s crime rate), and F16 (the neighbourhood’s level of pollution).
- (b)
From the estate agents’ purview, only five factors were recorded: F1 (the actual location of the property), F2 (the possibility that the actual location of the property will be flooded), F6 (the accessibility of transportation services), F9 (the property’s neighbourhood road network), and F12 (the availability of electricity and other infrastructural supplies).
- (c)
In comparison, only three factors—F1 (the actual location of the property), F6 (the accessibility of transportation services), and F12 (the availability of electricity and other infrastructural supplies)—were common to both groups of respondents.
- (d)
In calculating the results of the decision criteria rule table, the opinion of each respondent was calculated on a five-point Likert scale. For evaluating the perceptual analysis on which this paper was developed, a decision criterion was applied to ensure uniformity. As a result, since the research focused on a developing nation, the researchers opted for the use of a unified measurement system for the proper classification of the results. Despite the range of different studies defining their own methods of classification, this study used the computation of finite-degree classification of the results—which is a unified measurement method in higher educational institutions—as a clustering technique for making informed decisions.
- (e)
According to the perception plot, the highest determinants were the locational factors, followed by the neighbourhood factors. The plot also shows that behavioural factors have the highest bearing on the investment decisions for private investors, at 4.4, followed by the economic factors at 4.0 and the locational factors at 3.6. The plot also shows that neighbourhood factors have the highest bearing on the investment decisions for estate agents, at 4.6, followed by the economic factors at 4.0 and the locational factors at 3.6. This implies that there are various degrees of correlation between the factors examined in this study.
This information will be useful to existing and prospective real estate investors, as it suggests what to look out for when making decisions. The findings of this study can guide prospective investors and other stakeholders when deciding on developmental projects, particularly in areas that may be at risk of flooding. This is because the flood-risk areas cannot be left untouched, because of land scarcity, increasing population growth, and the need to meet the demand for housing provision to accommodate population growth. This study presents innovations by filling the knowledge gap in the research looking at these attributes in Nigeria, while also considering megacity investment and flood-risk investments in areas of property development to guide prospective investors on whether or not investing in flood-risk areas is worth it.
This survey focused on property investment and decision-making in areas at risk of flooding in Lagos State, Nigeria. However, a nationwide survey would provide a broader view of the motivations behind real estate property investment decisions in other areas prone to flood risks in Nigeria. The shortcomings of this research are reflected in the study’s interpretation and generalisation of its findings. First, the inference drawn was focused on a relatively small sample size, thereby affecting the generalisability of the findings. Future studies could adopt a larger sample size for the rank agreement analysis. This could help provide more robust insights. Second, other parametric analyses could be performed in addition to increasing the sample size. This may reveal significant gaps among stakeholders’ perceptions of decision-making motivators in property investment. Future works could also consider the use of flood modelling and the development of cognitive maps from perception analysis in investigating decision-making in flood-risk areas. Since flood risk is a major threat to the built environment globally, perceptual assessments of investment decisions in flood-risk areas could play a valuable role in improving flood-risk management. It is vital to highlight the relevance of the findings of this research for the field and pave the way for future scientific development in flood-risk management such as machine learning.