As a Nigerian living abroad considering investing in Nigeria, real estate investment is one of the viable sectors in which you can profitably invest.
And this comes as no surprise because a good real estate investment will deliver a good return on investment while protecting your money against inflation.
But there’s a catch…
Investing in Nigerian real estate can be challenging because of the issue of land grabbers (omo onile) and swindlers.
They specialize in duping unsuspecting buyers by selling properties with fake documents, land under government acquisition or landed properties they have no authority to sell.
Or, even worse, they outrightly resell a property they’ve sold to their victims.
Eventually, when their fraud is discovered, the victim is left with huge financial losses and in some cases, they have to go through lengthy legal battles.
Alas, it’s not all gloom, you can still safely invest in real estate in Nigeria and this blog post will show you exactly how to do achieve this goal.
But before we go any further, let’s consider some benefits of investing in Nigerian real estate as a Nigerian in the diaspora.
Why You Should Invest in Real Estate as a Nigerian Living Abroad
While the economic outlook of the country might not necessarily be impressive, there are some bright spots in the dark cloud that savvy investors are taking advantage of to build wealth.
And real estate is one of such sectors.
Prospective real estate investors can leverage different types of real estate investment models to profit from real estate investment.
So you can decide to do Land banking, which is simply buying land in a strategic location that’s undergoing development or locations with good infrastructural development potential, and reselling the land in the future for greater profits or capital gains.
Another option is investing for rental income by buying a developed property or building a property yourself. It goes without saying that this model of real estate investment is most profitable in locations that are currently undergoing development and are close to economic hot spots – rental properties in such locations command higher rents than properties in more remote locations.
Now if you’d like a model that doesn’t make you do much work after acquisition, then land banking is a great option for you.
Indeed, a good investment in real estate can yield profitable returns as high as 15% to 100% return on investment in 1 to 3 years.
Yes, it’s possible as long as you’re making a strategic investment by investing in fast developing locations…
Or locations with proposed infrastructural development.
Because the rate of appreciation in real estate prices are affected by location and level of development.
The more developed a location is – like Victoria Island, Ikoyi, Lekki – the higher the cost of property in that neighbourhood.
What does this mean for you as a prospective investor?
It simply means you’ll profit most from real estate by buying lands in areas where development is still ongoing – like Ibeju-Lekki – because it gives you an opportunity to get higher profit margins if you decide to resell in the future.
Basically, your profit potential for investing in Ibeju-Lekki is higher than Ikoyi or Victoria Island.
You see, Victoria Island and Ikoyi are already developed, so the cost of land there (that’s if you’re even able to get one) goes for hundreds of millions… as high as 300 million naira.
While a plot of land at Ibeju-Lekki could still be purchased from 2.5 million naira upwards.
And it’s potential for increasing in value is high, with experts projecting the price of a plot of land at Ibeju-Lekki would rise to as much as N450 million per plot in the next 10-15 years.
Ibeju-Lekki is currently the fastest appreciating location in Nigeria, which makes it an investor’s haven.
And guess what?
The value of land there will appreciate even further, because it’s an area that is undergoing development and is home to Lekki Free Trade Zone and other proposed major infrastructural projects including the construction of a deep sea port and international airport.
Now, imagine you acquire an acre of land in Ibeju-Lekki, Sangotedo or Abijo (they are in the Ibeju-Lekki environ) now and resell 5 or 10 years later at a 100% or more profit…
You would have succeeded in growing your wealth while totally beating inflation.
Plus, the weak foreign exchange conversions put you in a good position to seriously invest in real estate.
A few thousands of the dollar, pound or euro easily translates into millions of naira… allowing you acquire a substantial amount of land in strategic prime locations over time.
Now let’s talk about how you can invest profitably in real estate without losing your money to fraudulent individuals.
How to Safely Invest in Real Estate in Nigeria
You’ll discover the steps you should take to make your journey into real estate investment profitable even while you’re living abroad.
Let’s dive in…
1) Decide on the location:
When investing in real estate, the location of your landed property can make or mar the profitability of your investment.
Unlike buying land for residential purposes, where you can choose to buy land wherever you like…
You have to choose strategic locations that’ll give you the best return on your investment when buying land for real estate investment.
Just as we talked about earlier in this post; Ibeju-Lekki, Sangotedo, and Abijo are hot investment destinations right now.
Sangotedo and Abijo are within close proximity to Ibeju-Lekki.
All these areas are very viable investment locations with high appreciation rates because of the ongoing and proposed development in Ibeju-Lekki.
When you’ve decided on your location, the next step is…
2) Decide on a real estate agency or consultant:
Are you wondering why you need a real estate agency or consultant?
Well, a good real estate agency or consultant can help you make the land acquisition process seamless.
They understand the Nigerian real estate jungle and they can guide you through the purchase process while providing answers to your questions in order to help you make the best decision.
Whether you have questions on land titles, statutory charges/other charges, time of allocation, budget issues like payment plan (if you need one), or a virtual (video) site inspection… they have got you covered.
We’ll know this, because that’s what we do for our clients to ensure they have a stress-free experience when investing in real estate in Nigeria.
Your real estate consultant will work with you to make your land acquisition from reputable real estate companies…
This is important in order to avoid buying land within areas government has marked for other purposes…
Anybody that mistakenly buys land in such places is flushing money down the drain.
That’s why it’s important to buy your land from a reputable real estate company and your real estate consultant can help you find these reputable companies.
Another advantage of buying land from reputable real estate companies is the fact that your landed property is secured… once you’ve made all necessary payments and your parcel of land is allocated to you, nobody is going to resell your property unlike communal land sellers and land-grabbers.
3) Make payment securely:
After working with your consultant and deciding on the land you want to buy, it’s time to make payment.
Now you might be tempted to send the payment through your real estate agency or consultant, but that won’t be necessary if the land is being purchased from an estate that belongs to a real estate company.
Payments will be made directly to the real estate company selling the land in the estate you’re buying from.
Ideally the agency or consultant you’re working with should tell you this…
But if they don’t, you have to request for the account details of the company managing the estate, and confirm it’s the company’s account details via call.
When you’ve completed this step, you can now proceed to securely make payment.
It’s important to note that when you make payment for the land, you’ll also pay certain statutory charges (charges for processing your land documents, estate development charges and any other charge depending on the real estate company).
4) Get your land documents and allocation:
After making payments, the necessary land documents would be processed by the real estate company that sold the land.
Your real estate consultant will follow-up with the real estate company, ensuring that the deal is completed successfully with all necessary documents like your survey plan and deed of assignment.
The real estate company will process the land documents and you can discuss with your real estate consultant on modalities of how your land documents can be delivered to you or a trusted representative.
Alongside getting your documents, you can also talk to your real estate consultant about the modalities of your land allocation, too.
In any case, you’re in safe hands when you invest in real estate by buying your land from a reputable real estate company because your land will never be resold.
Strategically investing in real estate as a Nigerian living abroad is a smart financial decision that can be very profitable when done right.
Are you considering investing in real estate in Nigeria without stress or hassle?
We’ve got you covered, providing answers to your questions and helping you successfully purchase your land and properties through the network of reputable real estate companies we work with…
Simply contact us and we’ll take it up from there.
Send us a message on WhatsApp or call 0811 027 8930