The downside of investing in real estate in Nigeria has always been its high barrier to entry. You will most likely need to put a large sum of money down to get started.
The Nigerian real estate investment platform, however, offers a unique solution for real estate investments.
In Nigeria, this type of investing is, by comparison, relatively new, so there isn’t a great deal of history to draw on. Nonetheless, these online real estate platforms have been certified as legitimate and safe.
There are a variety of online real estate investment platforms available in Nigeria that can assist you in launching your real estate investing career. Here are some of them
What Is Real Estate?
Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this an item of real property, buildings or housing in general.
Real estate is the land along with any permanent improvements attached to the land, whether natural or man-made—including water, trees, minerals, buildings, homes, fences, and bridges.
Real estate is a form of real property. It differs from personal property, which are things not permanently attached to the land, such as vehicles, boats, jewelry, furniture, and farm equipment.
There are five main categories of real estate: residential, commercial, industrial, raw land, and special use.
You can invest in real estate directly by purchasing a home, rental property or other property, or indirectly through a real estate investment trust (REIT).
How Do I Invest In Real Estate In Nigeria?
People are making tons of money in the real estate business in Nigeria currently, despite the economic slowdown, it is still a big money-maker for a country like Nigeria. The following are the major techniques used when investing in real estate.
1. The Gift of Rental Properties
Investing in rental properties is an age-old practice as is land ownership. You purchase a property and then rent it out to tenants. As the landlord, you are responsible for paying the costs of maintaining the property.
Rental properties can be a lucrative business for those with do-it-yourself (DIY) and renovation skills, and who are patient enough to manage tenants. Although this strategy does not require significant capital, it does require substantial funds to cover the maintenance costs and to cover vacant months.
2. Real Estate Investment Trusts (REITs)
Many Nigerians are not familiar with Real Estate Investment Trusts (REITs). Real estate investment trusts, or REITs, are collective investment schemes regulated by the Securities and Exchange Commission (SEC). These schemes pool investment capital from investors to acquire income-producing real estate or mortgage loans, or a combination of both.
Real estate investment groups (REITs) are ideal for people who want to own rental properties without the hassle of managing them. An investment in REITs requires a capital cushion and access to financing.
In a REIT, a single investor can own one or several units of self-contained living space, and the investment group manages all of the units on the investor’s behalf, such as maintaining them, advertising vacancies, and interviewing potential tenants. tenants. In exchange for conducting these management tasks, the company takes a percentage of the monthly rent.
ALSO READ: Top 20 Best Investment Companies In Nigeria 2022
3. Land/House Flipping
Real estate investment is the process of purchasing and reselling for a profit quickly. It is one of the smartest investments one can make, and it requires little to no effort on the part of the owner. In terms of money as well as knowledge of land ownership and the buying and selling process, you are good to go.
However, you would need a substantial amount of money if you want to make hundreds of millions, but you can start small by buying just one plot and grow to buy tens of plots and acres and keep selling them all year round.
The process of flipping houses requires extensive real estate experience, marketing, and renovation. For house flipping to work, one must have the capital and be able to oversee repairs when needed.
4. Property Development
Property development is a very capital-intensive industry. In this case, properties are acquired in nice spots, redeveloped into luxury apartments, commercial structures, etc., and then sold at a really high-profit margin.
For example, if you spend N200 million developing a house in an amazing location, expect to sell it for at least N400 million. A good location is critical when considering property development.
Investing in real estate is only the tip of the iceberg. There are countless variations of real estate investments within these examples. As with any investment, there is much potential in the real estate sector, however, you should make careful decisions, do your homework, research, and weigh out the costs and benefits before taking action.
5 Top Real Estate Investment Platforms In Nigeria
Risevest is a web-based investment platform that allows users to invest in real estate, stocks, and fixed-income assets. Risevest allows you to invest in a portfolio of real estate holdings in the United States. You get money from your dollar investment in the form of rent and capital interests.
The investment plaform deals in high-demand properties in the United States at a discounted rate. They flip these properties and either rent or sell them.
Risevest divides each property it buys into 10,000 investment units, each worth $10.
All Risevest properties in the United States are covered by insurance against loss, damage, and loss of rental income.
Wealth.ng is an online investing platform which has assets in treasury bills, equities, mutual funds, and real estate.
On Wealth.ng, you can invest in real estate through its fractional property platform or by purchasing shares in Real Estate Investment Trusts (REITs).
The Wealth.ng fractional property function allows you to co-own real estate holdings with other investors by pooling money. This real estate investment platform, allows you to buy as many units as you want.
Unlike Wealth.ng and Rise Vest, Coreum focuses solely on real estate investing. You can invest in a part of a property using this Nigerian real estate investment platform.
With this Coreum, you can invest in land or residential buildings. On Coreum, each property is divided into 100 units. You can also buy as many units as you like.
Coreum requires a minimum investment of N50,000. The expected return on investment (ROI) might range from 7.1 percent to 15%.
Oxfordvest is a multi-partnership investing platform that allows investors to make investments in a variety of sectors, including agricultural, real estate, oil and gas, banking and finance, and earn reasonably significant returns on their money (ROI).
You can use USSD, Mobile App, Internet Banking, and ATM to make payments in naira, dollar, euro, and pounds.
5. Chagoury Group
This is one of the trusted real estate companies in Nigeria.
Chagoury Group was founded by Gilbert and Ronald Chagoury.
The little beginning of the Chagoury group started with flour and maize production in the early 1970s. Today, Chagoury Group is among the list of top real estate companies in Nigeria.
However, the Chagoury group eventually found their feet to establish their main focus as a construction division and has since grown to become one of the leading in west Africa.
Their headquarters is based in Lagos, Nigeria.
With the aim of developing industrial links between Africa, China, and Latin America, Chagoury real estate employ tens of thousands of well trained, skilled, dedicated, and strong working force.
No wonder they are one of the best estate developers in Nigeria.
They pay attention to detail and understand the needs of the local market. Being an innovative employer, they provide a safer working environment for all its employees, providing unparalleled access to private healthcare, pensions, and family benefits.
Helpful Suggestion: 10 Best Performing Mutual Funds in Nigeria 2022
How Much Does It Cost To Invest In Real Estate In Nigeria?
The least amount to invest in Real estate in Nigeria is about ₦2 Million to ₦5 Million.
Is Real Estate Investment A Good Investment In Nigeria
No other investment class quite generates the level of passive income like Real Estate. As long as you invest in property – commercial or residential – and you place it in the rental market then you will earn passive cool cash. You know how you spend the better part of the year saving for your rent only to reluctantly transfer it to one landlord or landlady when it is due, well, that is how you will feel; only that you will be on the receiving end with a huge smile on your face.
Investing in Nigerian real estate through all the five platforms mentioned here is a great way to make money, even though they all have their pros and cons.
In contrast, Rise seems like a better option since its investments are in dollars and your returns are also in dollars.
Wealth.ng and Coreum are also excellent options. These investments do not provide dollar returns, but they are solid investments nonetheless. Thanks for reading, do well to share and comment.