Why Invest In Nigerian Real Estate? First ask, what is Real Estate?
Real estate simply means the buying or leasing of properties that are residential or commercial. Properties like Flats, terrace apartments, detached houses,maisonettes, Condos, warehouses, office buildings, shopping malls, parking lots to name a few.
Why invest in Nigerian Real Estate you ask? Here are 7 reasons why people invest in real estate;
- Increase ROI Some people invest in property to enable them earn returns on their investment. Committing funds for asset, which will yield profits. This is usually long term.
- Prestige In this situation investment is for social recognition and status quo as landowners. The motive here is social respect and admiration.
- Cash flow Here, is investment as a means of generating constant income. The process being to buy a property and to lease/rent it out. The rental income can be monthly, biannual or yearly.
- Speculative Purpose The motive for investment here is speculative, the investor buys properties with the hopes of reselling it at a higher price in the near future, this is different from flipping. The investor makes a forecast on the price of a particular property market based on area growth, economic or predictions and purchases to wait for the predicted price projection.
- Portfolio diversification This is more a strategy of investment in real estate. Here the investor spreads their investment risks across several sectors to diversify investment portfolio. This investor has investments in other non- real estate sectors.
Also called property flipping, this type of investor buys properties in fast developing area or distressed properties. The investor usually works to increase the value of the property (building on it, refurbishing it), and sells it when the value appreciates.
This motive is to bridge the effect of inflation on a capital/fund. By using the effect of time on the value of money. Such as increased rent and capital appreciation of a property.
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