Operators in the real estate sector have advised Nigerians to extend their investment tentacles to the industry as they claimed it is more lucrative than its counterparts.
Though, a real estate consultant, Mr. Abiodun Doherty, agreed that the diverse nature of real estate investment makes it difficult to say with certainty that a particular type of real estate is the best but assured that investors have made money at one time or the other on all the various types of real estate investments available.
He said, “Investors can consider commercial buildings such as hotels, office complexes, shops, warehouses or industrial layouts. Commercial properties often command higher rents. If they are in some specific locations, the income generated from rents can be so significant that your entire investment can be recouped within 10 to 15 years.
“Also, you can buy a parcel of land at the right location at the right time. This form of real estate investment is easy if you have enough cash to buy the land. There are many areas, especially in the outskirts of town where land is still available at a reasonable price. You do not need money for development. You just need the patience to wait for it to appreciate before you sell. If you do your homework before buying, making money from a land purchase is simply a matter of time.”
Another form of real estate investment worth considering, according to Doherty, is rental property. To him, there is intense demand for residential properties, which earn investors regular cash flow. “The value of your property also keeps on increasing. You can decide to hold on to the property or sell the property in order to make a profit. Rental properties can be designed to meet the needs of the low, medium or high -income earners of the society. The design of the building can be a single room, a self-contained room and parlour, a two or three-bedroom apartment or duplexes,” he said.
But another property expert, Mr. Sanmi Ajao, warned that the investment has its own downside. In Nigeria, he explained that a potential investor needs to ensure that he has contractual, legal and effective ownership of the land.
He said, “It is important to ensure that you are not buying a land that is under committed government acquisition. You need to ensure that you have all the legal documents signed and registered. In addition to all this, you can take possession by fencing the land.
“The rationale for this is the sheer lawlessness of traditional land owners who often trespass on people’s land. The illegal actions by these people often result in litigation and loss of property. A good title and effective possession often make it difficult for them to trespass.”
