The Top 3 ways You can Invest in Real Estate in Nigeria (+ tools and strategies)

Invest in Real Estate
Invest in Real Estate

Many years ago, a large number of Nigerians could not invest in real estate. Before you can own a real estate, you need a large sum of money. Plus, there were fewer available options for people to enter the market. However, with development and technology, the process has become simplified. You would be shocked that with N5000 you can own a piece of real estate.

A recent way to create a passive source of income is to invest in real estate. There are a few proven ways in which beginners and professionals can develop an income stream from real estate.

Today, I’m going to reveal methods, secret tips, and platforms you can use to invest in real estate. Before we handle this, let’s refresh your knowledge with the following questions.

What is Real Estate?

Real estate can be described as, land and any man-made or natural development affixed to it. This could be in the form of buildings, nature reserves, mineral resources, and other similar things. 

For instance, a residential building can be tagged as real estate. Properties like resorts, reserves, parks, industrial buildings, and so on, are all forms of real estate. This asset is quite distinct from personal property like cars, clothes, devices, and many others. 

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The Top 3 ways You can Invest in Real Estate in Nigeria (+ tools and strategies) 7

Real estate properties have unique characteristics, asides from this, they can neither be moved nor destroyed. 

You can classify real estate into many categories. These categories include residential, industrial, land, and so many others.

Why should you invest in Real Estate?

Do you know that the price of buildings may depreciate, but the land doesn’t? 

Think about tax advantage, constant cash flow, great returns. These are some of the many ways you can benefit from real estate investments. With good assets, creating, building, and managing wealth is guaranteed. 

Compared to many stocks, you can earn more dividends with REITs (Real estate investment trusts). REITs are obliged to pay 90% of the profit to investors. We will discuss more on REITs in the next section. In addition, appreciation is a constant when you invest in real estate. You should know that real estate value increases over time,an example is Rent. 

Although Real estate brings a lot of cost, once you settle that, income and cash flow becomes steady. You should invest in real estate in Nigeria, because you will make money through diverse ways. Guaranteed ways include profit from business activities, rental income, and appreciation.

Ways You can invest in Real estate in Nigeria

You may ask yourself, “what ways can I invest in real estate?”. I would say that there is no one way to enter a market. There are various portfolio types and methods used by investors in real estate.

However, l would show you 3 proven ways in which you can invest in Real estate as a Nigerian.

The first is;

1. Ownership and Rental of Properties

Invest in Real estate
Rental Property

Are you excited about managing your own property? Then, you should consider this real estate investment type.This type of real estate investment in Nigeria is as old as land ownership. All you have to do is buy a residential or commercial property, then rent it out. After that, you can earn income from the rent. 

If you like doing things yourself, you should opt for this, although it requires rigorous management. When you own a property, you are tasked with the responsibility of managing both the tenants and the property. Nonetheless, if the task becomes cumbersome, you can hire a professional to manage the property. These professionals are popularly called caretakers in Nigeria.

2. Flipping of Land and Buildings

Renovation, marketing, and valuation, are the major skills you need to successfully flip properties. Most beginners are advised to stay off flipping of properties. This is because it is capital intensive. It also requires rigorous observation of the property involved. 

Just like scalping poses more risk to Hodling, that is how flipping demands more skills to the other real estate investment style. Many times, flippers buy undervalued properties and sell them after a few months. There are two known types of flippers, the one that considers the visible value before buying a property, and the category that renovates the property after buying. The former holds property temporarily, while the latter buy them for the long run. 

3. Fractional Investing With Real Estate Investment Trusts (REITs)

Many digital investment platforms in Nigeria offer their users a chance at fractional investing. You can now invest in real estate in Nigeria through fractioning. REITs are the real estate form of fractional investing. This style is suitable for real estate investors who avoid theeeee rigours of either property flipping or rental properties. 

REITs investing is similar to crowdfunding, where a corporation or group uses the investor’s money to buy and manage real properties. The group sells these properties in the form of units to the investors. These units are then sold on exchanges and trading platforms like stocks. Speaking of stocks, REITs have less risk compared to stocks. So, they are a good way to diversify your portfolio and minimize risk. 

Unlike other ways to invest in real estate, an investor can earn profit from industrial and special properties, such as office buildings, shopping malls, resorts, and so on. These kinds of properties are very expensive for an individual investor.

Bonus Section 1: Invest in Real Estate -Top Apps and Platforms to Use 

If you are looking for a simplified way to kick off investing in real estate, then this is for you. The apps are beginner friendly, less expensive, and easy to understand. I would quickly list three of the best online platform to invest in real estate in Nigeria.

1. Coreum

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Coreum Real estate investment Plans

This is one of the online platforms in Nigeria, that focuses fully on real estate investment. With coreum, you can purchase units of lands or residential properties. You should hold at least N50,000 to get a single unit. You can also purchase as much as you want.

2. Wealth.ng

Invest in Real estate
Properties offered on Wealth.ng

Another good platform you can use to invest in real estate, is wealth.ng. This platform offers various instruments you can purchase such as mutual funds, stocks, treasury bills, and even real estate. They offer you fractional investing and also REITs. From wealth.ng, you can invest in student housing, malls, and residential buildings.

3. RiseVest

Invest in real estate
RiseVest Mobile App

Like Coreum and weath.ng, Risevest offers units of properties for its users to purchase. You can purchase a unit, with as little as $10 and expect up to 15% yearly returns. RiseVest buys and develops US properties, then put the properties for rent or sell. The cost of purchasing and renovation of properties would be divided into 100,000 units, for users to purchase.

Check out a similar post on Online platforms for investing in Nigeria

Bonus section 2: Important habits of successful real estate investors

Real estate like any other form of investment requires strategic skills to make bountiful profits. Whether you are a newbie or an expert investor, there is a need to utilise a strategy. One of these strategies is cultivating important habits. The more positive investing habits you practice, the more income you make. Let’s dive straight to the top most habits you should consider.

1. Always make a plan

2. Conduct your Research

3. Know the market

4. Keep Learning

5. Have an understanding of the risk involved 

Conclusion

At this point, you have learnt about how to invest in real estate in Nigeria. This post has highlighted the benefits of real estate investing, types of investment, and platforms you can use to invest in Nigeria.

Now its your turn!

What type of real estate investment would you try out? Would you try out REITs, property ownership, or house flipping?

Tell us your decision in the discussion section below.

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