How To Start And Succeed In Real Estate In Nigeria

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The real estate industry in Nigeria is a very alluring industry. This is not surprising, as the industry is very lucrative and has created many millionaires and billionaires. But, just like any industry, as much as it appears like an all-comers affair, it is anything but that. If you must succeed in real estate in Nigeria, you need to know exactly how to start and succeed in it. As much as the real estate industry in Nigeria has produced many millionaires and billionaires, there have also been many victims who have gotten their fingers terribly burnt because they did not know how to succeed in the real estate industry of Africa’s biggest economy! So, how do you start and succeed in real estate in Nigeria? Before we answer that question, we need to understand what real estate means, as well as the types of real estate. Real estate refers to real—that is, tangible—property made up of land as well as anything on it, including buildings, animals, and natural resources. Fundamentally, there are 4 types of real estate: • Residential real estate: These refer to any physical space that people reside and live on either alone or with their families. It is where people literally make their homes and come back to sleep every night. It refers to physical spaces made of houses that are ‘homes’. These types of property tend to be situated in secluded areas for the purpose of security, serenity, and nearness to nature. • Commercial real estate: These includes shopping centres and strip malls, medical and educational buildings, hotels and offices. These are physical spaces where people put up to basically conduct their day-to-day business, either in services or products. They tend to be nearer major roads and markets for the sake of accessibility by all and sundry. • Industrial real estate: These are physical locations, lands, resources and structures that house only one aggregated industry, ensuring the industry in question can enjoy the economics of scale associated with localization of industry. Examples include Computer Village, Ladipo, Alaba, Trade Fair. • Land: This is general land irrespective of where it is situated. This does not have any structure on it. The only tangible thing about it is the bare earth and space over which the bare earth on it stretches. These lands can eventually be converted to the above mentioned three uses, or to becoming farmlands for agriculture. So, how do you start and succeed in real estate in Nigeria? First, Identify your motivation. The importance of motivation cannot be overemphasized. Motivation is what keeps you going when you face setbacks, disappointments, challenges, delayals, and every other possible stumbling block you may encounter in your journey. Motivation ensures that you not only keep going notwithstanding the challenges but that you keep going because of these challenges. As rewarding as the real estate industry may be, it is not a get rich quick scheme. Remember it primarily involves selling. A lot of selling. And selling is usually not easy at first. In fact, it can be downright very frustrating. However, if you have motivation, you will stay driven and focused on your goal, till they are achieved. Your motivation may be to escape poverty, or to quit 9-5 employment, or to help people access homes, or to be able to be an employer of labour. Whatever it is, find it and hold on to it. Because you will always need it if you must succeed in real estate in Nigeria. Second, Identify the aspect of real estate you want to focus on. As mentioned earlier, there are four types of real estate in Nigeria. And within those four types of estate, there are many ways to earn income from them. You can earn income via real estate speculation. You can become a real estate speculator by buying property, holding it for a period and then selling it after the property price appreciates in value. You can also earn income via rental income. This refers to buying rental income-generating property and making money from the rent paid by your tenants. The rental income here refers to income earned by the rental of real estate. You can also earn income via property development. As a property developer, you can buy land, build residential apartment blocks on them, and then sell each apartment at a premium price to recover your capital and make a profit too. This is for the big boys and is consequently cost-intensive. You can also earn income via property flipping. Property flipping refers to the art of buying an old property, renovating it, and selling it. It is not unusual for an old property in a choice location to be undervalued because it has become old. As an investor desirous of earning revenue from property flipping, you can identify such property, buy them at their reduced and under-valued price, renovate them and sell them. After the renovation, because the property is already in a choice location, the value of the property is bound to soar. You can proceed to make your profit from the sold property and move on to the next one. Lastly, you can earn an income via property brokerage. This requires that you facilitate a real estate sales transaction and earn a fraction of the value involved as sales commission. A person who engages in this is called a realtor. Third, acquire relevant knowledge. One of the major reasons why a lot of people fail in business is because they do not know enough about the business. Lack of product and market knowledge is a big problem indeed. It is not enough to know about real estate, you need to invest in studying how the mind of the average real estate consumer works. You also need to know the dynamics of the market, its peak season, and its slow season. You need to know what the policy of the government of the day is regarding the industry and how it impacts your business. The quest and need for relevant knowledge should be a never-ending one. However, enough of it is needed in the beginning to position you to succeed in real estate in Nigeria. Fourth, have a plan. He who fails to plan plans to fail. If you must succeed in real estate in Nigeria, you must have a plan. You cannot afford to act spontaneously and depend on hope, chance, or fate to give you success. You need to have a well-detailed plan that clearly articulates why you are into real estate, what you hope to achieve, how you plan to achieve it, and your exit plan as well. The plan guides you and ensures you do not stray off course particularly when you are faced with challenges, or temptation to drift away. The plan also helps you measure the success of your activity to ensure that you are truly making progress. Fifthly, find a mentor. Whatever you are trying to achieve in real estate, someone else has achieved it too. It, therefore, makes sense to identify this person and learn the ropes from him or her and have them mentor you. The mentorship does not necessarily have to be physical. You can be mentored by their materials, books, and interviews. All these would give you an insight into how their mind works, what guides their decision making, as well as show you what they did and how they did it to get successful. Six, build relationships. In real estate, relationships are everything. You may have heard the saying that your network is your net worth. This is truest in real estate. Relationships ensure that even when you do not make a sale today to a client or a prospect, you are guaranteed to make that sale as soon as the prospect is able to make the purchase. It also ensures that even prospects, acquaintances and friends who are unable to patronize you today for whatever reason, would not hesitate to become your brand evangelists, referring you to all and sundry. Seventh, Leverage digital media. Lastly, Be patient. Success in real estate is a hurdle, not a sprint. Therefore, success needs to be built on all the aforementioned principles. It must be built delicately and painstakingly over a period. A quick check of all the real estate gurus, entrepreneurs and billionaires around the world would quickly show that none of them built their empires overnight. They worked hard, they worked smart, and they worked long. If you must succeed in real estate in Nigeria, you must put in the work, but more importantly, you must be patient.

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