*How to Invest in Real Estate in Nigeria*
Real Estate is not Dead
The Opportunity in
Real estate Investment in Nigeria:
Real estate is as old as God’s green earth and ever since man started cultivating land and marking territory - the
accompanying commerce that ensued around using said piece of earth to make profits and all the
activities carried out carried out therein - gave birth to Real Estate Investment.
Nigeria, a country of over
200million people has a housing deficit of 17-21million depending on who you quote. With an ever increasing population growth, Nigeria is a prime investment
destination, a ready market for various investments; tech, financial services and real estate investments.
But when we talk about real estate investment in Nigeria there is a need for us to realize and appreciate the peculiarity of our situation here in Nigeria. If you don’t realize, understand or appreciate our peculiarity and try to paint Real Estate
investment in Nigeria with the same brush as is done in other climes - you may run into problems.
Nigeria as a Real Estates investment destination Real Estate is worthwhile - with a ready hungry market that you can take advantage of.
In the Real Estate sector, much like in other sectors in Nigeria - we have to
constantly tweak literature to align with our local realities. These are the important things you should know about Real Estate investment in Nigeria:
1.) Learn from Successful Real Estate Companies and
Developers in Nigeria
If you want to dive into how to make successful real estate investments in Nigeria - it goes without saying that you have to look at some successful real estate companies and developers in Nigeria.
You have to study how they have done their real estate investments and stayed successful for years in Nigeria. Despite the numerous challenges they have somehow managed to not only stay afloat but thrive.
If you want to invest in Real Estate or start a real estate business here in Nigeria, you should definitely pay attention to what they are doing. I can tell you that they are getting alot of things right.
2.) Choose The Right Real Estate Investment Strategy
Broadly speaking they are four (4) major Real Estate investment strategies:
i.) Rentals:
Rentals are one of the oldest, safest, and most steady source of income from Real Estate.
In Rentals, you buy a property to put on the market for monthly or yearly rental. It has a lot of upsides like; regular cash flow, asset appreciation, collateral for loans, and property can be sold afterward for a profit.
The downside is that just like in many numerous and apartments, you may experience non-subscription of your apartment for long periods.
A company like First World Communities handles rentals in a prime places like Victoria Island, Lagos. A 3 bedroom flat there goes for NGN 7m.
ii.) Flipping of land and Houses:
Also referred to as land/property banking - you purchase a property to sell in the quickest time possible for profit.
Major Real Estate investment strategy is buying and reselling land whilst providing infrastructure around the residential and commercial development.
They can see as much as over 100% ROI because they actually buy this land for cheap from Omonile, by doing ’
sponsorships deals‘.
iii.) Property Development
Property development involves purchasing land, erecting various ,
developing infrastructure, and selling to the buyer either at carcass (lintel level), fully finished, with fittings, plumbings, and so on, or fully finished to be sold out or for rental purpose.
But property
development is capital intensive and it requires alot to position for success.
You have to position for
success because it isn’t a walk in the park.
