The MPR was increased from 12 percent to 14 percent, making a total of 200 bases points.

Real estate experts have reacted to this, with a lot of negative predictions, News Agency of Nigeria (NAN) reports.

Most say that this increase will have a negative impact on investments, developers and mortgage institutions.

For Mr Chucks Omeife, the past President of the Nigerian Institute of Building (NIOB), this hike will be a problem for developers.

He urged the government to come up with better policies.

"But due to ineffectiveness of the mortgage system, developers are falling back on commercial banks to source fund for real estate developments.

In my opinion, the hike is ill-timed because the economy is technically in recession.

We expect the government to come up with policies that will control the inflationary trend and kick-start economic activities in rest of 2016," he said.

Omeife was supported by Mr Olayemi Shonubi, a former Chairman of the Lagos branch of the Nigerian Institute of Quantity Surveyors (NIQS).

Just like the NIOB past president, Shonubi says this increment poses a threat to developers.

However, he also added mortgage institutions, and ultimately, investors, to the list of bodies, affected by this hike.

"This is because developers and mortgage institutions source funds from the money market.

For the mortgage institutions, which source their fund from the money market, it means that the institutions will invariably increase their interest rate on loans to the people.

And this implies that the nation's mortgage system, which has not been strong and effective will get weaker because investors will be completely discouraged from using the scheme," he explained.

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