A recent survey by Ugoada Orji through her organization found that Nigerians in the Diaspora account for 70% of real estate investment in Nigeria, while those at home account for 30%.
Also, a World Bank Report stated that Nigerians living in the Diaspora sent $22 billion home in 2017 alone, the largest remittance in African history and the fifth-largest in the world. This explains why our brothers abroad can afford three-fourths of properties in Nigeria.
Obviously, the constant devaluation of the Naira and the greener pasture abroad put them in a favourable condition compared to their compatriots at home.
But the question is, “are they getting the most value for their money?”
Aren’t they falling for overpriced properties when they can actually buy cheap land or houses offered for sale in the same location, which increases their chance of maximizing their ROI?
Well, this article will dissect this question in a simplified manner and recommend how Nigerians abroad can:
- Spot the optimum land available for sale and cash out big,
- Identify overpriced land at a glance,
- Safely buy these affordable houses or plots of land offered for sale at your chosen location and
- Grow wealth effortlessly through acquiring the right portfolio of cheap land available for sale in Nigeria.
How to Know The Optimum Land Available for Sale
The secret of buying the optimum land available for sale is in your ability to spot overpriced land. This is very important because overpriced land eats into your potential ROI.
However, it is important to note that cheap land for sale is not the same as the cheapest land in town. That is why the goal is to buy the plot of land at the optimum price.
A Short Story to Drive Home the Point
In 2018, a developer in Nigeria had 2 different estates opposite each other. One of the estates is phase 1, and the other is phase 2. They tagged phase 1 for #20,000,000 and phase 2 for #6,000,000.
Phase 1 was higher than phase 2 because it existed before it. By implication, phase 1 was almost soldout, and its level of development is higher than the other. There was already a gatehouse, electricity, paved network roads and other amenities that made it livable. But phase 2 was upcoming. The level of development and scarcity of plots of land in phase 1 made all the difference in price.
Therefore, phase 2 is the optimum plot to buy if it has the same title as phase 1.
If a property has the same quality or features as another and it is cheaper than the other, that property is the optimum plot of land available for sale in that location.
So, you should compare the features of both properties to know a cheap land or house for sale in an area.
What Are The Features To Compare To Spot Cheap Or Optimum Land for Sale In An Area
- The reputation of the developer
- The title of the property,
- The location of the property,
- The level of development in the estate and
- The price of the property.
In our illustration above, the same developer owned both estates. So the reputation is the same.
The estates are in the same location (directly opposite each other), so they are most likely to have the same title because the developer must have bought them from the same family. Both estates are most likely sharing the same excision.
Although the level of development of estate 1 is higher than that of estate 2, the same development will soon get to estate 2. It’s just a matter of time. A developer who has a culture of excellence will bring the same excellence to all its estates.
If you dig deep into the history of estate 1, you will find that it was once as cheap as estate 2.
A typical example is Amen Estate Phase 2 and Phase 3. Phase 3 presently sells for #12,000,000. There was a time when phase 2 also sold for the same price. Presently the residential plots of phase 2 are sold out. But if you get a landowner in phase 2 who wants to resell, he won’t sell for less than #25,000,000.
So, if you are considering which of them to buy for real estate investment purpose, I will advise you to choose the cheap land for sale among them (Amen Estate Phase 3).
How To Safely Buy Cheap Land Or Houses Offered For Sale In Your Chosen Location
Now that you know how to find cheap land for sale that meets your specifications, let me show you how you can safely buy it without being scammed in Nigeria, even if you live in the Diaspora.
The Nigeria real estate market is 2 faced: the formal and informal markets. While the formal is dominated by real estate firms, Omoniles are the key players in the informal market.
The informal market is very risky. Most Omoniles have nothing at stake when they defraud real estate investors. They are the ones notorious for selling 1 plot of land to several buyers. And they abscond when you institute legal action against them.
But real estate developers are worth so much. They have so much at stake, and you can easily drag them if they fumble.
Most developers have a formal and legal business structure worth billions of naira or Dollars. They have nowhere to run to because of the physical nature of their investments/estates.
Besides, it will be penny-wise, pound-foolish for a developer worth billions to run away because of tens of millions he got from you.
How To Buy Real Estate From Omonile
- Conduct a land search at the office of the Surveyor-General of your state before you buy land from Omoniles. The land search will uncover whether or not the land is under Government acquisition and the real owner of the land.
- Perfect your title as soon as you pay for the property. It is advisable to get this done through the service of a lawyer.
- Avoid backdoor or backdated documents. They will do you more harm than good in the long run.
Take note of the tips in one of my blog posts titled Rules To Avoid Land Scam That Will Blow Your Mind.
How To Buy Cheap Land Available For Sale From Developers
- Get a trusted real estate consultant or realtor to recommend some plots of land owned by reputable developers.
- Check the track record of the developer online. Examine the number of estates he owns, how long his company has been in existence and the level of development on some of his old estates.
- If you still have doubts, conduct a land search on the estate to be sure. All you need to conduct the search are the coordinates of the estate. Send the coordinates to your surveyor or lawyer and he will do the needful.
- Make sure you pay to the developer’s account when you are ready to buy. Do not pay to the realtor’s account.
- The realtor will help with the follow-up and paper processing with the developer, and the developer will send your land documents directly to you – no matter where you are in the world.
- The realtor’s services to you should be free because the developer will pay him a commission to appreciate him for your patronage. The commission paid to the realtor does not mean the developer charged you more. With or without the realtor, the property price remains the same.
How To Grow Wealth Effortlessly By Keeping The Right Portfolio Of Cheap Land For Sale In Nigeria
As earlier explained with the illustration of the 2 estates, instead of buying a plot of land from estate 1 for #20,000,000, you should buy 3 plots from estate 2 for #18,000,000 (#6,000,000 each).
Leave the 3 plots of land for a few years. When the value has significantly risen, you can sell 2 plots. Use the money for 1 plot to buy 2 or 3 other cheap plots of land in another location and use the money for the 2nd plot to develop the 3rd.
For instance, Queens Park Estate Phase 2 has a Certificate of Occupancy yet it is 6 times cheaper (#2,000,000) than Amen Estate Phase 3 (#12,000,000). So, you can consider buying 6 plots of Queens Park Estate 2 instead of just 1 plot of Amen Estate 3 (especially if you are just starting real estate investing).
Repeat this process over and again. And boom, you will discover that you are already generating generational wealth.
Let’s End It Here
One thing you want to avoid when diving into the real estate market is overpriced property because it reduces your chance of maximizing your ROI.
However, it is better to buy an overpriced property than let Omonile scam you. So, ensure that you follow strict rules and expert advice when patronizing Omoniles. Those guys are not smiling at all.
With reputable real estate developers, your property is safe even into the unforeseeable future. You can bank tens of plots of land with them and still have peace of mind. Remember that you need some time for the value of the land to rise so you can resell them and cash out big.
Finally, remember that the goal is to buy the optimum property, not the cheapest property in town. I can’t emphasize it enough that cheap land for sale is not the same as the cheapest land in town.
If this process seems difficult for you to implement and you need a pro to further guide you on acquiring cheap or the optimum land for sale in Nigeria, you can email one of our real estate advisors at [email protected]