How to start a real estate business in Nigeria

Real Estate business in Nigeria is a highly profitable investment. With a booming population and a growing middle class, Real Estate is one business that anyone can invest in and make long term sustainable income. It never depreciates. It is regarded as business for all season.

Nigeria is one of the greatest black nations on earth. The country has the largest economy in the continent of Africa, it is the largest producer of oil and it is also the most populous black nation in the universe.  Despite the greatness of Nigeria, many Nigerians find it difficult to make money in their own country. That’s ironic, isn’t it?

It is a known fact that the best avenue to make a whooping money in Nigeria is the oil sector. However, due to the global decline in oil price, the sector is witnessing a great challenge at the moment. What’s the way out? The government is looking into diversifying the economy from the oil sector by pursuing reforms in the Agricultural and mining sectors.

It will be a surprise to you that while the oil sector is being struck by a hurricane, there is one sector is that is booming greatly. This sector can now be described as an avenue for every business man or aspiring business man to catch big fish and make money. I am talking about the real estate sector.

For you to understand this, take a look at the billionaires in Nigeria today; you will realise they will be in one of oil or real estate sector. An example to recall is Mike Adenuga; he is into the two sectors. His oil company is Conoil and he recently he acquired shares in Julius Berger so as to make his real estate business easier. Indeed, real estate is the new Sherif in town. If you have read this piece up to this point, it means you are ready to learn the basics of starting a real estate business in Nigeria. That’s exactly what I will show you in the next few minutes. If you are ready, here we go!

How much can you make from a real estate business in Nigeria?

Before you read on, let me ask you one question. Do you know one asset that can never depreciate till the end of time? Think about it and answer the question before checking the answer.

Have you thought about it? Let me tell you the answer. Land is the only asset that will continue to appreciate till the end of this world.

As much as the level of profit you can make from real estate business largely depends on location, one thing you should know is there is opportunity to make profit everywhere.

Talking about how much you can make from this business, let’s look at a very quick example. I know of a man, he bought a plot of land in Ibadan for ₦145,000 in 2016. In 2018, he sold this same land ₦250,000 Naira. That’s a profit of 63.63% in about 2 years. This is the case in almost any location; when you invest in real estate, you can be sure to get almost double the amount you invest back in just few years.

Opportunities in Nigeria Real Estate Sector

There are various business opportunities in Nigeria’s real estate sector and these are detailed below:

1. Land flipping/resale

This is very common in Nigeria. It involves buying a land or property at a cheaper rate and reselling it to make more profit. This requires a reasonable amount of money to start. Just make your research, get some money and buy your first plot of land.

2. Real Estate Agents

The real estate agents are also known as real estate brokers. They are the middle men between the buyers and sellers of a real estate property. They connect the sellers with the appropriate buyers. After the sales, the agent will make his or her own commission from the transaction.

3. Property rent/leasing

This is a good way to make money in real estate. Buy some property and lease it out. If it’s a building, it’s advisable for you to get it in a good location so that you will not struggle for tenants. The tenants will pay you either annually or monthly and you can decide to sell the property when you wish.

Steps to start a real estate business in Nigeria

The following details the steps you need to take to start a real estate business in Nigeria:

1. Create a plan

Every business needs a plan. The same is true for the real estate business, you need to make a business plan for it. This plan will detail all the goals you want to achieve in future. The business plan should outline a clear map of the proceedings. This will give you confidence in moving forward and pursuing your goals.

2. Perform a comprehensive market research

You want to be sure that your business idea truly works. Which niche in the real estate market is most profitable in Nigeria? Which one is the best for you? Who are the big players in Nigeria’s real estate sector? The market research will give you an idea of how to position yourself within the niche. Most importantly, you need to know the laws that guide the real estate business in different Nigerian states and particularly the state where you want to start your business.

3. Register with Corporate Affairs Commission (CAC)

As you know, you are in for serious business. This is not a child’s play. Therefore, it’s good you register your business with the appropriate authority. For Nigeria, it’s the Corporate Affairs Commission (CAC). With this, your business will have a legal backing. You can also join estate developers association in Nigeria.

4. Get finance for your business

You need to save some money for your business. While carrying out your market research, you should already know how much you need to start a real estate business in whatever location you want in Nigeria. You can also get in touch with investors who can make investments in your business. Aside from this, if you don’t have enough money, you may get a loan.

5. Work on branding

Branding is very essential for your business. You need to build the image and reputation of your business from the beginning and develop it as you move forward. And you can start this by first creating a logo, making hand bills, publicizing your business in newspapers, radio, television, and real estate journals. You need to build relationship with potential clients, distinguish your business from competitors, give your clients value for their money etc.

6. Create a marketing plan

This is one part of your business that should never sleep. You must start marketing from the beginning of the business and it must never stop for any reason. As you make your way in the sector, you will start getting referrals from your previous clients. This should never stop you from marketing your business more and better. Marketing is the real soul of every business.

7. Maintain an online presence

In this modern day where we are preparing to enter the fourth industrial revolution, it is very important that your real estate business has an online presence. This is quite easy, you can create a website. You have an opportunity of getting many clients online because the number of Nigerians using the internet has increased tremendously. MakeMoney.ng can build a world class website for you for a reasonable fee.

Apart from having a website, you can also have social media accounts like Facebook, Twitter and Instagram. You can use the website and social media for digital marketing and boost the business.

Conclusion

You have gotten yourself acquainted to the basics of the real estate sector. All you need to do now is to get ready, prepare yourself, and do your assignments well so that the moment you start, you can hit the ground running.