7 Secrets to Know Before Investing in Real
Estate in Lagoss
Real Estate investing is one of the most solid and lucrative
investment in the world. Then it is therefore no surprise
that 90% of millionaires became so through investing in real
estate. “Owning a home is a key stone of wealth… Both
financial affluence and emotional security”- Suze Orman.
So, as you begin to explore it, I want to first congratulate
you on taking that big step to become a land/house owner/
real estate investor. It’s the greatest asset you can ever
own that will continue to appreciate in value both for you
and your generations to come.
As lucrative as it is, there’s little doubt that property/land
purchase can be a challenging task and for a first time
buyer however, it can be downright overwhelming and
tasking. From illegal and fake land documents to relentless
omo oniles (indigenous land owners) looking for the next
swindle, there are a several pitfalls that could befall an
unsuspecting first time property/land buyer. Before buying
any property or parcel of land, therefore, it is important to
conduct several checks before parting ways with your
money.
There’s also the not-so-small matter of location and
budget. While we may not all be able to afford ocean front
property at Banana island, Lagos, there’s always
something appropriate for everyone provided you conduct
the right checks and make adequate plans and enquiries.
Below are some points that should be considered before
purchasing property/land:
1. 1. Budget:
This is a key factor to be considered before purchasing any
parcel of land or property as it determines several things
including the size and location of the purchase. If you’re
buying already developed property, then you should also
decide whether it’s a bungalow, duplex or block of flats you
want and work it into your budget. While several hundred
millions could fetch you a duplex in Ikoyi, Lagos, for
instance, the same amount could fetch you an entire
community in some parts of Ibeju Lekki. It is therefore
necessary to determine how much you have and are willing
to spend. Most importantly, however, is ensuring you stick
to your budget. The greatest mistake of most intending
property buyers is not having a budget before they set out
to buy a land. Always take the time to research the other
fees that are usually associated with buying a land and
they usually come in these forms.
1. Legal fees- 5% of the cost of the land
2. Agency Fees- 5% of the cost of the land ( a and b are
usually not applicable when buying from some
companies e.g. Pwan Homes. It’s already factored into
the price of the property. Except you’re bringing in your
lawyer whom you’ll have to pay)
3. Survey Plan- (usually above N100,000-N300,000)
Depending on the location of the land and state.
4. Cost of signing the documents/ Documentation
5. Cost of putting up a fence to secure your land
immediately you purchase it (you may not have to do
this immediately if you’re buying within a gated estate)
6. Cost of perfecting your documents with the
Government at the Land Registry such as a C of O,
Governors Consent, Ratification fees, Survey Land
information etc. (Also, if you’re buying from an estate
manged by a reputable company, they take on this
responsibility)
7. Cost of renovations if you’re buying an already
developed property or cost of completion if you’re
buying a shell
Once you have done the maths to know all these hidden
fees that are associated with buying a land, it will
adequately guide you on the location and type of land that
would suit your pocket.
2. Location:
This is another crucial factor you should decide on before
making any purchase. Depending on personal choice,
factors such as proximity to workplace and school should
be seriously considered. Safety, water/power supply, good
road and transport network are also some other factors
that should be considered before deciding to buy any
property. While we are not really susceptible to weather
hazards in Nigeria, it is still important to ensure that the
area is not prone to flooding or is not close to dams that
need to be opened every now and then. You could talk to
people in the neighbourhood and sample their general
opinion of the area concerning safety, availability of power
and water, amongst other things.
If you are purchasing a block of flats for rent, you must
research and find out how much rent is reasonable to
expect considering the area and quality of the property. It is
further advisable to purchase property for rent or eventual
sale in a school or commercial district as property there is
likely to yield higher profit and appreciate when it is time to
sell; should the need arise.
As an Investor, you want to get the best value for your
money. And this often translates to the best return on your
investment. With this in mind, you want to evaluate the
potential growth in investment in a particular area before
you throw your hard earned money at it. Why get less when
you can get more? Choose your investment location wisely.
3. Know the true owner of the property:
Always keep the following questions in mind: “Who is the
owner of the property?” “Who is selling the property? Is it
the owner, the owner’s wife, son, daughter, or someone
else?” “Whose name appears on the documents? Is it the
current owner or the previous owner?” “What liabilities
currently exist on the property?”. If you are buying from a
company, you need to know if they are duly registered by
CAC and who their Director/Chairman is. Be sure they are a
reputable company. If possible, meet with buyers who have
bought from them before.
4. Verifying the Documents:
Before you buy a plot of land or a completed building, be
sure to conduct what is called a “search” on the property.
This is the process of verifying from the state government
if the property in question is within government acquired
properties or not and whether there are any pending
litigation or other issues on the property. The bureau of
lands of Lagos state is responsible for all land related
matters in Lagos state. It has its office in Government
Secretariat, Alausa Ikeja, Lagos, Nigeria. A lot of people are
confused here and depend on the information given to
them by the agents, if you have an honest agent good for
you. But I strongly recommend you get your lawyers
involved, it would cost you some money but trust me its
money wisely spent. Don’t be a penny wise, pound foolish
5. Always physically inspect the property:
Never buy a property you haven’t seen physically or sent
someone you trust to inspect. There is a lot of information
you can pick up on when you’re there. It is very important
to check the status of the land to know whether it is a
swampy land that would cost you millions of Naira to sand
fill. Don’t buy lands from the comfort of your office or what
someone has told you. Visit it yourself and confirm it is
something suitable for you and your family.
No matter how beautiful or attractive the land being
advertised appears please go there and look at it. Don’t rely
on just pictures and sweet words because there are so
many other important things the picture or advert won’t tell
you such as the neighbourhood, light and water issues, the
road leading to that place, amenities such schools or
hospitals, transportation ease to and fro, market etc. Make
sure you check all these things before you finally commit
yourself to buy a land.
Always trust your own instinct and 95% of the time, it’s
right. The moment you visit a land, follow whatever your
gut tells you. If your mind is shaky about the land, don’t
push it; walk away, the land isn’t meant for you.
If you see things that makes you suspicious, please walk
away. If you see things like fenced lands that cannot be
justified by the owner or no proof of ownership, no survey
plan, you hear the land is a relocation land or there is a
minor dispute that was just solved, so many family owners
or sellers etc. please walk away and move on to the next
property. You may have just dodged a bullet. Don’t let
anyone pressurize you into buying it. The signs that you
see now might seem so small and irrelevant but 5 years
down the line it may begin to manifest seriously.
6.If everything looks good, say a prayer and make your
payment:
Few things to note when paying
a. Never pay in cash. Cheques, bank transfers or bank
draft are better to document the payment
b. Never pay into the agent’s account. Pay directly to the
owner. Though you’ll pay the agent’s fee into his own
account
c. All your Land Transactions must be documented to save
yourself from unwarranted issues in the future. There are
so many documents you need to make sure the title of that
land is properly transferred to you such as a deed of
assignment, contract of sale, letter of allocation, affidavits,
purchase receipt, deed of gifts, letters of administration,
survey plan etc. Not having some of these documents
could lead you to lose the land to someone else who has
done his documents to claim ownership of the property.
Please ALWAYS consult a property lawyer experienced in
real estate to guide you on the documents you need to
prove ownership of that land.
Never buy a property without proper documentation of the
sale no matter how close you are to the seller, a lot of
things could go wrong. He could die, how do you prove to
his family or community that you bought the land validly
from him? What if another person lays claim to that same
land, how do you prove ownership?
The 4 basic things a Buyer must have when they pay for a
land is a Receipt, Deed of Assignment, a contract of sale
and a Survey Plan. Without these 4 things you have a very
slim chance of proving ownership if anything goes wrong in
future. If you’re buying from an estate, you still have some
time to get the survey while the survey of the entire estate
still covers you. In this case you could be given a
provisional allocation letter.
7. Take possession:
As soon as you buy it, try to take possession of it by
constructing a small fence around it. You don’t have to do
9 coaches, just 2 or 3 is enough to demarcate your land so
that any prospective buyer of the land knows that it has
already being bought and should stay clear of it. Pour
gravel or sand there, do a well on the site and visit if
frequently. Hire a mai guard to come on the land to watch
over it till you have money to build something tangible. If
you have a friend or relative living in the area, you could
ask them to visit the property frequently on your behalf too.
Don’t just leave it fallow and expect it to wait there for you
when you are ready. Somebody else could end up
encroaching on your land to steal it. If you’re buying an
estate land with a reputable company they could give you
up to one year to build a fence and your property is still
secured. If it’s a developing area, you may have up to 2
years to put together money to start something.
Congratulations and welcome to real estate
Estate in Lagoss
Real Estate investing is one of the most solid and lucrative
investment in the world. Then it is therefore no surprise
that 90% of millionaires became so through investing in real
estate. “Owning a home is a key stone of wealth… Both
financial affluence and emotional security”- Suze Orman.
So, as you begin to explore it, I want to first congratulate
you on taking that big step to become a land/house owner/
real estate investor. It’s the greatest asset you can ever
own that will continue to appreciate in value both for you
and your generations to come.
As lucrative as it is, there’s little doubt that property/land
purchase can be a challenging task and for a first time
buyer however, it can be downright overwhelming and
tasking. From illegal and fake land documents to relentless
omo oniles (indigenous land owners) looking for the next
swindle, there are a several pitfalls that could befall an
unsuspecting first time property/land buyer. Before buying
any property or parcel of land, therefore, it is important to
conduct several checks before parting ways with your
money.
There’s also the not-so-small matter of location and
budget. While we may not all be able to afford ocean front
property at Banana island, Lagos, there’s always
something appropriate for everyone provided you conduct
the right checks and make adequate plans and enquiries.
Below are some points that should be considered before
purchasing property/land:
1. 1. Budget:
This is a key factor to be considered before purchasing any
parcel of land or property as it determines several things
including the size and location of the purchase. If you’re
buying already developed property, then you should also
decide whether it’s a bungalow, duplex or block of flats you
want and work it into your budget. While several hundred
millions could fetch you a duplex in Ikoyi, Lagos, for
instance, the same amount could fetch you an entire
community in some parts of Ibeju Lekki. It is therefore
necessary to determine how much you have and are willing
to spend. Most importantly, however, is ensuring you stick
to your budget. The greatest mistake of most intending
property buyers is not having a budget before they set out
to buy a land. Always take the time to research the other
fees that are usually associated with buying a land and
they usually come in these forms.
1. Legal fees- 5% of the cost of the land
2. Agency Fees- 5% of the cost of the land ( a and b are
usually not applicable when buying from some
companies e.g. Pwan Homes. It’s already factored into
the price of the property. Except you’re bringing in your
lawyer whom you’ll have to pay)
3. Survey Plan- (usually above N100,000-N300,000)
Depending on the location of the land and state.
4. Cost of signing the documents/ Documentation
5. Cost of putting up a fence to secure your land
immediately you purchase it (you may not have to do
this immediately if you’re buying within a gated estate)
6. Cost of perfecting your documents with the
Government at the Land Registry such as a C of O,
Governors Consent, Ratification fees, Survey Land
information etc. (Also, if you’re buying from an estate
manged by a reputable company, they take on this
responsibility)
7. Cost of renovations if you’re buying an already
developed property or cost of completion if you’re
buying a shell
Once you have done the maths to know all these hidden
fees that are associated with buying a land, it will
adequately guide you on the location and type of land that
would suit your pocket.
2. Location:
This is another crucial factor you should decide on before
making any purchase. Depending on personal choice,
factors such as proximity to workplace and school should
be seriously considered. Safety, water/power supply, good
road and transport network are also some other factors
that should be considered before deciding to buy any
property. While we are not really susceptible to weather
hazards in Nigeria, it is still important to ensure that the
area is not prone to flooding or is not close to dams that
need to be opened every now and then. You could talk to
people in the neighbourhood and sample their general
opinion of the area concerning safety, availability of power
and water, amongst other things.
If you are purchasing a block of flats for rent, you must
research and find out how much rent is reasonable to
expect considering the area and quality of the property. It is
further advisable to purchase property for rent or eventual
sale in a school or commercial district as property there is
likely to yield higher profit and appreciate when it is time to
sell; should the need arise.
As an Investor, you want to get the best value for your
money. And this often translates to the best return on your
investment. With this in mind, you want to evaluate the
potential growth in investment in a particular area before
you throw your hard earned money at it. Why get less when
you can get more? Choose your investment location wisely.
3. Know the true owner of the property:
Always keep the following questions in mind: “Who is the
owner of the property?” “Who is selling the property? Is it
the owner, the owner’s wife, son, daughter, or someone
else?” “Whose name appears on the documents? Is it the
current owner or the previous owner?” “What liabilities
currently exist on the property?”. If you are buying from a
company, you need to know if they are duly registered by
CAC and who their Director/Chairman is. Be sure they are a
reputable company. If possible, meet with buyers who have
bought from them before.
4. Verifying the Documents:
Before you buy a plot of land or a completed building, be
sure to conduct what is called a “search” on the property.
This is the process of verifying from the state government
if the property in question is within government acquired
properties or not and whether there are any pending
litigation or other issues on the property. The bureau of
lands of Lagos state is responsible for all land related
matters in Lagos state. It has its office in Government
Secretariat, Alausa Ikeja, Lagos, Nigeria. A lot of people are
confused here and depend on the information given to
them by the agents, if you have an honest agent good for
you. But I strongly recommend you get your lawyers
involved, it would cost you some money but trust me its
money wisely spent. Don’t be a penny wise, pound foolish
5. Always physically inspect the property:
Never buy a property you haven’t seen physically or sent
someone you trust to inspect. There is a lot of information
you can pick up on when you’re there. It is very important
to check the status of the land to know whether it is a
swampy land that would cost you millions of Naira to sand
fill. Don’t buy lands from the comfort of your office or what
someone has told you. Visit it yourself and confirm it is
something suitable for you and your family.
No matter how beautiful or attractive the land being
advertised appears please go there and look at it. Don’t rely
on just pictures and sweet words because there are so
many other important things the picture or advert won’t tell
you such as the neighbourhood, light and water issues, the
road leading to that place, amenities such schools or
hospitals, transportation ease to and fro, market etc. Make
sure you check all these things before you finally commit
yourself to buy a land.
Always trust your own instinct and 95% of the time, it’s
right. The moment you visit a land, follow whatever your
gut tells you. If your mind is shaky about the land, don’t
push it; walk away, the land isn’t meant for you.
If you see things that makes you suspicious, please walk
away. If you see things like fenced lands that cannot be
justified by the owner or no proof of ownership, no survey
plan, you hear the land is a relocation land or there is a
minor dispute that was just solved, so many family owners
or sellers etc. please walk away and move on to the next
property. You may have just dodged a bullet. Don’t let
anyone pressurize you into buying it. The signs that you
see now might seem so small and irrelevant but 5 years
down the line it may begin to manifest seriously.
6.If everything looks good, say a prayer and make your
payment:
Few things to note when paying
a. Never pay in cash. Cheques, bank transfers or bank
draft are better to document the payment
b. Never pay into the agent’s account. Pay directly to the
owner. Though you’ll pay the agent’s fee into his own
account
c. All your Land Transactions must be documented to save
yourself from unwarranted issues in the future. There are
so many documents you need to make sure the title of that
land is properly transferred to you such as a deed of
assignment, contract of sale, letter of allocation, affidavits,
purchase receipt, deed of gifts, letters of administration,
survey plan etc. Not having some of these documents
could lead you to lose the land to someone else who has
done his documents to claim ownership of the property.
Please ALWAYS consult a property lawyer experienced in
real estate to guide you on the documents you need to
prove ownership of that land.
Never buy a property without proper documentation of the
sale no matter how close you are to the seller, a lot of
things could go wrong. He could die, how do you prove to
his family or community that you bought the land validly
from him? What if another person lays claim to that same
land, how do you prove ownership?
The 4 basic things a Buyer must have when they pay for a
land is a Receipt, Deed of Assignment, a contract of sale
and a Survey Plan. Without these 4 things you have a very
slim chance of proving ownership if anything goes wrong in
future. If you’re buying from an estate, you still have some
time to get the survey while the survey of the entire estate
still covers you. In this case you could be given a
provisional allocation letter.
7. Take possession:
As soon as you buy it, try to take possession of it by
constructing a small fence around it. You don’t have to do
9 coaches, just 2 or 3 is enough to demarcate your land so
that any prospective buyer of the land knows that it has
already being bought and should stay clear of it. Pour
gravel or sand there, do a well on the site and visit if
frequently. Hire a mai guard to come on the land to watch
over it till you have money to build something tangible. If
you have a friend or relative living in the area, you could
ask them to visit the property frequently on your behalf too.
Don’t just leave it fallow and expect it to wait there for you
when you are ready. Somebody else could end up
encroaching on your land to steal it. If you’re buying an
estate land with a reputable company they could give you
up to one year to build a fence and your property is still
secured. If it’s a developing area, you may have up to 2
years to put together money to start something.
Congratulations and welcome to real estate
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