Real Estate in Lagos: Buyers Guide
This article will learn about the steps you need to take if you want to invest in real estate in Lagos and why you should use it Now. The real estate purchase is one crucial step everyone is bound to take simultaneously, either to have a place to call home or as a wise investment.
In the last few years, Real estate has become one of the steady investment alternatives in Nigeria, and owning land or property in Lagos right now is a viable and wise investment.
It is interesting to note that Lagos state is the most populous state in Nigeria. One of the primary reasons for this is the economic viability (economically feasible, innovative, and sustainable in investing financial resources into the project). It’s because of this that millions of Nigerians move there for business and other purposes.
Even though the Nigerian Economy entered recession in the third quarter of 2020 amidst the coronavirus, several industries, including real estate, suffered greatly. However, reports from Lagos showed that real estate developers have continued to develop new properties during the pandemic due to the high demand for residential housing units.
While you are eager to acquire land/property in Lagos, you may overlook some obvious and easy-to-detect signs of forgery and fraud in the excitement of becoming a landowner in the prestigious business capital of Nigeria. Therefore you will need to take some necessary steps to protect your property.
Why You Need to Invest in Real Estate NOW
There are a hundred and one reasons why investing in Lagos is the best decision you’ll make when you’re dealing with real estate but let’s take a look at 5 Reasons Why You Need To Invest In Lagos City’s Real Estate in 2021:
Ever Growing Population
The population is undoubtedly a significant determinant of growth for the real estate sector. Lagos State has the smallest landmass in the whole 36 states of Nigeria but yet the most populous state in Nigeria.
Lagos has grown from just a 1.4million residents in 1970 to about a 22million as of today. With a population density of about 5000persons/Sq. Km is making it one of the most densely populated cities in Africa. It has been estimated that 86 people migrate to Lagos every hour, 2000 people every day, and close to a million people every year.
That’s a constant flow of fresh and enthusiastic citizens looking for accommodation, purpose, and fulfillment. The emphasis is on housing.
Growing of Middle-Class Population to High-Income Earners
The vibrant Economy of Lagos has led to a growing middle-class population with enough cash to spend on luxuries and decent accommodation. As a result, the housing market segment remained robust despite the economic headwinds experienced by every other sector of the Nigerian Economy, attributed to strong demand from the middle class and high-income earners.
Prices in the Lekki axis, an area for high-income earners and a middle-class neighborhood, grew an average of 2.8 percent when other segments of the real estate sector declined countrywide. In addition, Lagos has the largest share of the working population in Africa; over a 15.2million of the estimated 22million residents are within the 15 – 64years age bracket.
With no sign of stopping, the city is becoming a juggernaut for real estate investment due to the presence of readily available buyers.
Economic and Industrial Hub of Nigeria
Abuja may have replaced Lagos as the administrative capital of Nigeria, but Lagos remains the commercial capital of Nigeria. Lagos holds the crown when we are talking about business.
Lagos is the most prosperous state in Nigeria, with a GDP of about US$33.67billion, accounting for 25% of Nigeria’s total GDP. It is the fifth-biggest economy in Africa and home to over 2000 manufacturing companies, 200 financial institutions, and the most significant clusters of small and medium-scale enterprises in Africa.
About 80% of all Nigerian imports go through Lagos ports, which consume more than half of the country’s energy. In addition, Lagos accounts for over 90% of Nigeria’s foreign trade.
Let’s face it, Lagos is a powerhouse and is home to some of the most ambitious people on the continent. Even market research shows that Lagos State has the highest property values and the most successful real estate market in Nigeria.
Increasing Property Prices
At this point, the biggest reason why Lagos is an excellent location for investments is an almost ridiculous rate of return of investments on real estate properties. The Lagos State Market Analysis shows Lagos as having some of Nigeria’s most significant estate prices. The Lagos estate industry remained buoyant and, in some cases, flourished even when the value of the real estate in other states across the country plummeted from the recent economic recession. A plot of land purchased for 5 million in Lekki in 2006 could go for an average of 65 million now. It’s no surprise why real estate transactions occur dozens of times daily as more and more people seek to stake their claim in the blossoming city.
Strong Rental Market
The leasing rates in this city are rising rapidly, which stands to promote the fact that many Lagosians are opting to rent over buying out properties; this is a reflection of the supply-demand gap of affordable housing in Lagos and is mainly due to the cost of homeownership, high costs of land, and staggering costs of building construction. Developers are aware of this direction the industry is headed. Approximately 75% of landowners already have plans to develop rental properties due to their ability to return on their investments quickly and an ample supply of the populace available to rent the very second construction is complete.
Best Areas in Lagos to Buy Real Estate
Before buying land in Lagos, you need to know some basic things, and it is only wise to consider location when investing in real estate.
This is because when it comes to real estate investment, location has a lot to do with your return on investment.
Whether you are a first-time real estate investor or investing before, while considering location before buying land and properties, you should consider price appreciation of the property.
Here are some lucrative areas in Lagos that guarantee a high return on your real estate investment.
- Ibeju Lekki
You may be thinking, why the above locations? Let me give some quick explanations as to my choice of locations.
Lekki is very popular today because of its rapid development and high appreciating rate of landed properties in the area. Yes, Lekki phase 1 used to be an excellent place to invest for a high return on investment but no more because it has reached its peak for now. It can only appreciate to about 2% in a year.
But if you are looking to invest in rental properties, Lekki is one of the best places in Lagos to invest.
Sangotedo is a town situated just after Ajah that has seen considerable investment in the recent past. As a result, we have experienced a commercial and real estate boom, which has created a very high return on investment for wise investors. For example, a plot of land in Westwood par estate Sangotedo sold for N8.4m in 2017 and 2 years after trading for N17.5m a scheme.
This part of Lagos is termed the new Lagos because of Nigeria’s next real estate investment hub. If you invest in real estate for a significant return on investment in Nigeria, buy land in Ibeju Lekki Lagos. The reason is location and proximity to government international and local investors and companies’ significant developments. So much is happening in Ibeju Lekki that you cannot avoid investing in its real estate.
You don’t have to be told about the potential in the Epe axis of Lagos State. As developments criss-cross through Ibeju Lekki, you will find out that Epe Local Government will be the next bus stop as people will be rushing to that part for cheaper and affordable accommodation.
According to real estate experts, the average minimum price per plot in the Epe – Ibeju Lekki axis has been predicted to sell for an estimated N5 000,000 per plot in the next five years.
The Lagos state government and private sectors will benefit from relentless efforts to develop Epe. Some of the ongoing massive projects that Epe investors will benefit from include; Lekki-Epe International Airport, Dangote Refinery and Petrochemical Company, Epe resort and spa, Lagos, and Dubai SmartCity project.
This is an excellent place to buy real estate because of its proximity to developed cities like Ikeja and developed areas. Therefore, properties in this axis will appreciate fast and high as well.
Many people don’t know this yet, but the historical city of Badagry would soon become a new haven for developers and investors because of the availability of lands and the deep seaport and the discovery of crude oil in the area.
Going by the publicity given to Lagos-Badagry Expressway and the monorail transport, the area will record more boom, as we have never seen before.
Director of Echostone Development Nigeria, Mr. Sammy Adigun, believes, “When you talked of Lekki 20 years ago, that is what Badagry is today; Badagry is just ten years away. Badagry will be an important economic hub in the next ten years, and real estate will boom.
With the city just joining the oil-producing communities, properties and land rental value will increase when people come and are looking for accommodation.
Getting Documentations for Real Estate in Lagos-Step by Step Guide
There are various essential documents to ask for when buying a house or land in Lagos. Some of these documents are used to verify the title of the seller of the property. In addition, you must ensure that the seller has the legal right to transfer ownership of that property to you to avoid unnecessary disputes.
Some of these documents you need to get include;
- Land Purchase Receipt: Everyone goes out to purchase different items and demands receipts. When purchasing land, the rules are similar. Once you have verified the authenticity of the land and other property documents listed below, you must demand payment in writing, i.e., the receipt. When you pay off without collecting the ticket, it becomes near impossible to trace again. The best means of payment are through cheques addressed to the company or through online transfers. By doing this, you can be sure that your income and the beneficiary can be easily tracked if there are any issues shortly.
If you are buying from a family, you need to ensure you go directly to the family lawyer who will issue you a receipt (family receipt), a verified excision document with an accompanying gazette where the Government published the land as being excised to the family. Additionally, a registered survey and a layout plan will have to be requested if they are available.
- 2. An approved survey plan: This is another important document you need to get after buying land or property. It is a requirement that a certified surveyor must survey every land and that a survey plan be submitted to the Government for approval. Upon approval of the document, a survey number accompanies the survey plan, which is the survey plan number. It is a unique number and can verify if the land is under any government acquired or committed area. If you have purchased a larger parcel of land, you will need to request a layout plan to know where the land within the more significant estate is located. At times you may also want to see the development plan of the estate; you can classify the buildings in the estate. Some states do not permit the mixing of different building patterns. Therefore, it is always wise to ask how the plan will affect your intended use and program.
- Excision document: This type of document is particularly useful when a Certificate of Occupancy (C of O) is not available. You need to be sure the land is not a government acquisition or on the government’s plan for future use. Excision properly gazetted and verified by the Ministry of Land will make for a suitable land document.
When you buy land from a family with Excision, you will fill out form 1c, which you will submit to the Government to prove that the land has been sold to you by the family.
- Deed of assignment: This is a signed agreement between you and the seller of the land signed and stamped by a notary public that a particular plot or plot of land has been given to you. The document will be signed by the property seller, the property buyer, and a notary public. Also, a deed of assignment must include a certified layout plan and the survey plan for your plot. Also included in the contract is the plot number assigned to you and the coordinates for the main boundaries of the property. In addition to the above, other critical information to be included are the plot’s size, cost, a seal of the company, the signatures of witnesses, and properly initialed pages.
- 5. Certificate of Occupancy: This is the certificate issued by the Government to the first occupant of land. When land has a certificate of occupancy, it is an excellent land to purchase but make sure you verify the authenticity of such document from the Government. When an original owner has sold a property to another party, the land should have a governor’s consent. The transfer of purchased land to another party from the original owner is incomplete without the Governor’s support. It is the only authorizing document notifying you of the Government’s approval of the transfer of such land property.
The advantage of obtaining the Governor’s consent whenever buying land in Lagos is that The Government will protect your investment from omo onile or from taking over by another person. However, you must also register your Governor’s consent with the bureau of lands, which will attach a number to the document for easy tracking. I know the process can be overwhelming, but it is in your best interest to take the necessary steps to protect your property.
How We Can Help You Buy Real Estate in Lagos
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Our company extends its real estate services to both residential and commercial niches. So, if you’re looking for the best place to buy your real estate property in Lagos, You can trust our team to provide you with direction, guidance, and results. Just contact us to discuss your options.