Real estate is as old as the earth and ever since man started cultivating and marking territories, the accompanying transactions that followed around using said piece of earth to make profits and all the activities carried out therein, gave birth to real estate investment.
According to statistics, Nigeria is a country with a population of over 200million people with a housing deficit of 17-21million and with the ever increasing population growth, Nigeria is a prime investment destination, a ready market for various investments especially real estate investments. Nigeria as a real estate investment destination is worthwhile- a ready and fast market that every investor should take advantage of.
In this article I will be talking about how you can make a lot of money from real estate investment in Nigeria and also how you can alternatively save a lot of money from your real estate investment deals.
THE TOP 5 THINGS YOU NEED TO KNOW
Investing in real estate in Nigeria can be a lucrative opportunity due to the country’s growing population and expanding urban developments.
Here are some points to help you get started.
1. Take Lessons From Successful Real Estate Companies And Developers In Nigeria:
Before diving into real estate investments in Nigeria, you have to research some successful real estate companies and developers who are making it in the industry and are well known for their integrity such as EHI-KINGS REAL ESTATE AND CONSTRUCTION COMPANY.
You have to study their patterns on how they have done their real estate investments and managed to stay on top of their game for years in Nigeria.
You also have to study how they succeed despite the numerous challenges in Nigeria. It is also important to gain knowledge about the Nigerian market, property laws and local regulations. Understand the different types of real estate such as residential, commercial and land, then learn about the potential risks and rewards associated with real estate.
2. Set Your Investment Goals/Choose The Right Investment Strategy:
Determine your investment objectives, whether it is long term capital appreciation, rental income or a combination of both. There are four major real estate investment strategies:
i. Rentals: Rentals are one of the oldest, safest and most steady source of income from real estate investing. In this type of real estate strategy, you buy or build a property then put it out on the market for monthly or yearly rent. This creates an opportunity for regular cash flow, asset appreciation and the property can be sold afterwards for a profit.
ii. Flipping Of Land And Houses: Land flipping is also referred as property flipping. This is when you purchase a property at a lower rate due to its condition and then renovate it to sell at a higher price. This is a way of creating wealth in Nigeria. Land flipping can also involve purchasing a property and holding on to it for a while in order for it to appreciate before reselling at a higher price. Land flipping just like any other real estate strategy requires proper planning and knowledge on the whole process. But be rest assured of gaining profit if you go about it the right way.
iii. Property Development: This is also called real estate development. This is the process of developing buildings or land into a higher use value. It is a multi-faceted business which can encompass any of the following: buying land and building property on it; renovating, extending or improving property; converting property from one type to another. Property development involves purchasing land, erecting various house types, developing infrastructure and selling to the buyer either at lintel level, fully finished with fittings or fully furnished. This can be arguably the most profitable strategy in real estate investment.
3. Understand The Role of The Government:
the role of the government in real estate in Nigeria cannot be over-emphasized. The role of the government per the land use act, empowers the governor to have unrestricted access to all land in the state. So the governor has to approve every single land transaction for it to become legally binding. If you do not do your due diligence and understand the role the government plays in rectification, ratification, giving titles, and approving transactions, you’ll most likely run into trouble.
4. Understand Land Laws and Titles:
From the above point, you should be aware that legally binding property transactions can only be done on a proper titled property registered at the state’s registry. You should know and understand the various land titles such as the Global C of O, Governors Consent, Excision, Gazette etcetera. Conduct thorough due diligence on any property you consider investing in. Verify the property’s title, survey the land, inspect the buildings condition and assess any legal or regulatory restrictions. Also engage the services of a good lawyer to handle the legal aspects of the transaction.
5. Choose the Right Location:
Location Is Everything; there is a popular saying which goes like this “Real Estate is all about Location! Location!! Location!!!”.
This fact is not any different here in Nigeria. Choosing the right location is one of the most important decision you would make. Choose a property in a prime location. One thing prime locations do for you is that your property sells itself. In Lagos Nigeria, the state government has deemed Epe and Ibeju-Lekki as both residential and urban areas respectively. Investors are trooping into these locations because they offer and promises huge returns on investment with the level of industrialization, the construction of the new Lekki International Airport, the presence of the Lekki Deep Sea port which was just commissioned, Lekki Free Trade Zone for commercial and trading activities. These level of development has made Ibeju-Lekki and Epe a once remote locations transform to a residential, commercial hub- a gold mine for investments spanning into billions of naira.
I hope this article was insightful?
Have any suggestions, questions or whatever. Kindly drop them on the comment section and I will respond accordingly.
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