How To Invest In Real Estate: 8 Key Steps On Getting Started

Invest In Real Estate. It’s a popular fact that real estate is one of the most rewarding investments while the stakes can be expensive, it yields great rewards when done properly. Currently, the supply shortage in Nigeria’s real estate market affords private investors and developers a high return on investment.

As they say, if it is with it, you’ll find a way. The same can go for Real Estate Investment.

So why should you be intentional in investing in real estate? 

As of 2011, only 66.3% of Nigerians were Homeowners while in 2021 the number has decreased to 62.0%. While this is an economic downsize with many just recovering from post-pandemic disruption and increasing inflation.

The demand for real estate keeps increasing and your ability to make money off the market depends on your knowledge, the goal, and the returns you aim to achieve.

READ MORE: 8 Ways To Stay On Top Of Property Market Trends

Here are some steps on getting on the real estate investment train

  • Make a research on the Real Estate Industry
  • Decide on the specific property market
  • Identify booming real estate markets
  • Invest in the foreign real estate market
  • Decide on where and how you would get the finances
  • Get the details right
  • Know the Law
  • Look to the future

Make a research on the Real Estate Industry:

If you are interested in the property market, there are platforms to find the information you need, including the news platforms, knowledgeable individuals, and of course Real Estate platforms. You could also create Google alerts, just find a way to keep yourself in the loop of things going on within the Real Estate Industry. You have to understand it before you get into it.

Decide on the specific property market

Based on your investment goals, you need to pick a sector that would benefit you extensively. It could be office buildings, residential units, industrial properties, etc. It is also good to keep in mind that some properties have faster returns than others, for instance, a shopping mall would probably get sold off before the construction is completed, while a residential property could take a bit longer to achieve the same.

Identify booming real estate markets 

Contrary to our above point, there could be a particular section in the investment sector that is getting hype but at a gradual process, and that could be for example the residential properties; as much as it is currently not as lucrative as some others, it has the potential to scale quickly in just a few years.

Invest in the foreign real estate market

Your investment portfolio doesn’t have to be defined by geography. If you understand what you’re going into, go ahead and diversify your portfolio. As they say, the sky is just the starting point.

Decide on where and how you would get the finances

The source of financing would vary depending on where you are in life. It could be from relatives, close friends, or financial institutions, you need to make sure you know what you are doing at every step. Make sure you have a viable plan which would be good enough to convince whoever you are getting the funds from. This is why picking the type of investment property is extremely important.

Although there are downsides to getting loans from Nigerian financial institutions, some of these downsides include the limited options of institutions to get loans from, the shame and harassment when it’s time for repayment; this doesn’t have to be the case and we employ you to understand everything you are going into to avoid problems along the line.

Also pay attention to the interest rates to avoid going into debt, according to this day, some institutions offer 20% interest per annum.

READ MORE: How To Buy Land In The Right Way(Opens in a new browser tab)

Get the details right

Try to avoid entering into business with sketchy people, or people you do not think are trustworthy. Talk to industry experts, and lawyers, and make sure you meet all requirements stated by the Government. Do not fall into the trap of building properties from unverified agents. Make use of platforms that have positive track records.

Do not employ untrained people because you are trying to reduce cost, with experience, we know this only leads to more spending.

Know the Law

Nigerians have quite a number of rights, and owning property is one of them. The 1978 Land Use Act gives state governments authority over land within its borders. They can then give it to individuals after a complex and bureaucratic process, then you get a certificate of occupancy to make use of the land whichever way you want.

Look into the future

Your dream investment property might not be as lucrative as others currently, but could potentially boom a few years down the line, you should go for it. In a few years, it could rack you up more millions than it would for others in the present day. For instance, we have seen a gradual increase in the purchase of properties in other states of Nigeria like Oyo and Ogun than it was when everyone wanted a piece of Lagos. This also applies to the increase in sales of properties in areas like Sangotedo than in Victoria Island.

Also, be at the top of Real Estate news as it could make or mar your investment dreams

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