WHAT TO CONSIDER BEFORE OWNING A PROPERTY
- Have a good budget. When buying a property, there are many hidden costs that can drive you crazy. But when you plan ahead of time, it will be a piece of cake. Some of the things to include in your budget are: the cost of conducting a search on the land, the price of the land itself, the agency fees to be paid, the cost of doing a survey plan, the cost of registering your title at the land registry, the cost of signing your documents, the cost the family would charge for signing your form and giving you a receipt, the cost of fencing in advance, the cost of clearing the land, the cost of settling the omo-onile’s, the foundation cost, the fees to be paid to the estate association if the land is located within an estate and fees to be paid for the planned amenities within the estate. Most of these fees can be negotiated and once you get a good price, you should act quickly and pay for all to avoid problems in the future. Delay in land transaction is extremely dangerous because the land become susceptible to fraudulent schemes of scammers.
- Choose a good real estate developer/agent ahead of time. This is to ensure you don’t fall for the tricks of scammers that are everywhere. If you’re not purchasing from a real estate agent but you decide to buy a family land, ensure you do your due diligence, so it doesn’t flop. There are pros and cons to buying from an omo-onile/family and a real estate developer/agent. Be vigilant!
- Choose your desired location. You should think of the best place to buy a property to get the most value. Research your chosen location to get all necessary information. For a purchaser, “value” may mean “comfort” and “status.” For a real estate investor, “value” may mean “real estate profit” and “property appreciation”. I can’t say enough about how important location is when buying real estate. In real estate investing, it makes a difference of 70–90%. There are some areas that are waterlogged and there are some that are the prime targets for kidnappings and theft. There are also some lands that are not safe for purchase like the land owned by the Isaac Oduji Family Land located at Oko Egan Area, Ilogbo Eremi Badagry Lagos state. This particular land is located in Ogun state and not Lagos as the vendors claim. Also the family is not in possession as they claim but has been purchased by Abia State government for agricultural use. Anyone that buys such a land should be ready to forego it in the nearest future. Another example of an unsafe land is located off Unity Road, Cooperative Villa Badore Eti-Osa Local Government, Lagos state. This land is part of the cooperative villa government allocation scheme that fraudsters are trying to sell to unsuspecting purchasers. Caveat emptor! (buyer’s beware).
- Decide on the type of property you want to get. Is it a land or a building? If it is a building, what type of building? There is bungalow which is a simple small homes with only one floor and no basement, flat/apartment which is a building made up of many separate homes that are stacked on top of or next to each other with less privacy, terrace which is a single-family home with two or more floors joined by other terraces sitting next to each other in a row, semi-detached that is a single-family home that shares one wall with the next house, detached which shares no wall with the next house, maisonette which is a small apartment that is a part of a larger building with its own staircase and entrance, duplex is a building with two separate units stacked on top of each other like apartments. If it is a land, is it a land for agricultural use or to build?
- Have a reason for wanting to buy real estate. People buy a house or a piece of land to live in or to use for business or as an investment. If you’re buying a house to live in, make sure it’s close to places you go often, like your job, a place of worship, your kids’ school, a hospital, grocery stores, etc. Those who are buying for business or investment should make sure it is in a place where business is booming.
- Consider government rules and policies. Through its town planning office, the government sets aside different places for different uses. Some land is set aside for farming, while other land is used for schools, roads, bridges, stadiums, industries, etc. These places are on land that the government bought. Anyone who puts money there is just throwing it away. It would be smart to buy a home near these places. People will work in and take care of the facilities there, and these people will need a place to sleep.
- The plan for paying. In Nigeria, you need a lot of money to buy a house. Only a small number of people can pay the price up front. Talk to your bank or lender about whether or not they have a good repayment plan. Having a trustworthy financial partner who will hold your hand through the whole process will be very helpful. When choosing a financial partner, you should think about things like how much their mortgages and loans cost and how long it takes them to pay back their loans.