Mistakes to avoid while buying real estate
A real estate expert has warned Nigerians to carry out due diligence when taking the decision to invest in real estate. He said investment in real estate guarantees a return on investment, but that there is a need for prospective investors to consult professionals in order to avoid mistakes. Opeoluwa Oni, Managing Director, Lifepage Estates, said […]
A set of terrace buildings in an estate located at Mabushi, Abuja
A real estate expert has warned Nigerians to carry out due diligence when taking the decision to invest in real estate.
He said investment in real estate guarantees a return on investment, but that there is a need for prospective investors to consult professionals in order to avoid mistakes.
Opeoluwa Oni, Managing Director, Lifepage Estates, said when buying land, the investor should consider purpose, budget, location, sourcing, due diligence, and negotiations, among others.
He said, “The number one mistake to watch out for is the mistake of purpose. You need to define the purpose why you want to buy that land. When it comes to purpose, when it is about acquiring land, some will say I am buying because everybody is buying.”
According to him, some people buy land due to peer purpose.
“There are different lands you are buying for different purposes, you don’t want to mismatch purpose, it will help you to know where to pitch your tent, how much you want to spend and what to do.
“Number two is budget. In the economy we are now, budget is very important. You can’t be looking for land in Gbadaga or GRA Port Harcourt and be carrying a budget of Epe. You must have a budget that suits the purpose you have defined. You can do your research. Get consultants to help you; we can give you clarity.
“If it is N1m you have, how much will that buy me?”
He stated that location is another mistake people make when buying real estate, saying, “When it comes to real estate, location matters.
“There are locations that have hit their peak. The rate at which land will appreciate in places like Epe, Ibeju-Lekki, Eleko, is not the same as in Gbagada. The rate at which land will appreciate in Gwagwalada is not the same way it will increase in other areas.”
On the issue of sourcing, he said it is important for people to determine whether to buy a direct land or go through the estate agent.
“Sourcing is very important. Am I buying from primary or secondary markets, how do I deal with the agents? You need to source right.”
He added, “On due diligence, you must not make mistakes of due diligence. You buy land, leave it there, they would give you some piece of paper and then would tell you, you are the owner of the land. If you are not experienced in this area, just get a lawyer but not any lawyer but lawyers that are experts in real estate. Get an experienced real estate lawyer to guide you to do due diligence.
“Due diligence is very important. Don’t miss it. From your due diligence, you know the right questions to ask, you know how to negotiate.
“You do not want to make mistake in negotiations. When you make mistake, you can be buying too expensive or you can be buying problems. For instance, you are buying a swampy land and you intend to build and you didn’t negotiate well.
“Negotiation is key. If you are not experienced, carry the person who knows along. Especially land that does not have title.”
Oni stated that in buying a property, especially from a primary market, one must be careful to ensure that not one person signed the document.
“If you buy too expensive, you have bought your way out of the market already. Negotiations and buying work hand in hand. When you are buying, you don’t pay up once. Unless you are buying from a real estate company,” he added.
He also advised buyers to take possession of their land by fencing it around immediately, saying the fencing can be done in phases.
He also stated that another mistake people make when buying land is documentation.
“From the point of due diligence, you are already factoring in what type of documentation you want to do. You can do it in phases, family receipt. Your monthly receipt is part of documentation. You keep all the documents. Video is part of your documentation. As they are transferring ownership is part of documentation.
He said in possessing and occupying a property, it is incumbent on the buyer to carry the community along.
“The community can save your life, your money and your investment,” he said.