Owning a home is a significant milestone in life, and for many Nigerians, it represents stability, independence, and financial growth. In a country where real estate transactions often require large upfront payments and where mortgages are not the norm, the path to homeownership can be challenging. Additionally, many Nigerians achieve this goal by buying land and building their homes over time, a process that offers flexibility but also demands careful planning.
If you are embarking on the journey of owning your first home, here are seven practical tips to help you navigate the unique challenges of the Nigerian real estate market.
- Understand the Financial Commitment
In Nigeria, most homebuyers either pay for completed houses outright or take the alternative route of buying land and building their homes over time. Both options involve significant financial commitments. For outright purchases, large upfront payments – often in millions of naira – are required.
If you’re buying land to build, you can spread the costs over time, but construction expenses, permits, and utility installations must be factored into your budget. Start by assessing your savings and income to determine what you can realistically afford. While urban areas offer convenience and amenities, they often come with higher property prices. On the other hand, rural or suburban areas may provide more affordable options but require trade-offs in accessibility and infrastructure.
Whether buying or building, ensure you have a financial cushion for unexpected expenses.
- Choose the Right Location
In real estate, location is everything. The location of your home is crucial and depends on whether you are buying a completed house or building one from scratch. If buying, look for areas with ready infrastructure, like roads, electricity and water. If building, ensure the land is in a developing or promising neighbourhood where property values are likely to appreciate. Consider the following when choosing a location:
- Proximity to work, schools and markets.
- Security and crime rates.
- Availability of essential services like electricity, water and public transport.
If you are buying land, research the area’s zoning laws and future development plans to avoid issues later. Visiting the area at different times of the day can also give you insights into its livability.
- Understand the Legal Process
Navigating the legal aspects of property ownership in Nigeria can be complicated, but skipping due diligence can lead to disastrous consequences. Before purchasing a property, verify its title to ensure it is legitimate and free from disputes or encumbrances. Engage the services of a reputable and trained Estate Surveyor and Valuer to conduct thorough checks. They will review documents like the Certificate of Occupancy (C of O), deed of assignment, and survey plan. Your Estate Surveyor and Valuer can also guide you through the signing of the purchase agreement and other legal requirements. Remember, it’s better to spend on professional advice than risk losing your investment to fraudulent transactions.
- Inspect the Property Thoroughly
Before purchasing a home or land, carry out a thorough inspection. For completed homes, check for structural integrity, plumbing, electrical wiring and overall build quality. If you’re not knowledgeable in these areas, consider hiring a professional property inspector.
If buying land, confirm its suitability for construction. Investigate factors such as soil type, drainage, and access to utilities. Ensure there are no encroachments or disputes over the land boundaries which could delay your building plans.
- Plan for Maintenance and Utilities
Owning a home goes beyond the initial purchase—it comes with ongoing responsibilities. In Nigeria, where public services can be unreliable, you may need to invest in alternative solutions like solar panels, boreholes, or generators. Regular maintenance is crucial to keep your property in good condition. From repainting walls to fixing plumbing issues, these expenses can add up over time. It’s wise to set aside a portion of your income for unexpected repairs and upgrades. If you’re buying a property within an estate, inquire about service charges for security, waste disposal, and other communal services.
- Negotiate and Budget for Hidden Costs
Negotiation is an integral part of buying property in Nigeria. Don’t be afraid to bargain with sellers or agents to get the best deal. However, beyond the agreed price, there are several hidden costs to consider. These may include fees for land surveys, building plan approvals, or community development levies (common in estates). Some areas also require buyers to pay for documentation transfers or registration fees. Preparing for these additional costs upfront helps you avoid financial surprises after closing the deal.
- Explore Mortgage Options
For most Nigerians, paying for a home outright is not feasible. Thankfully, mortgage options are available through commercial banks and institutions like the Federal Mortgage Bank of Nigeria (FMBN). Mortgages allow you to spread payments over several years, making homeownership more accessible.To qualify for a mortgage, you’ll need a steady income, a good credit score, and a substantial down payment. Compare interest rates, repayment terms, and fees among different lenders to find the most suitable option.
Conclusion
Buying your first home in Nigeria is a rewarding but challenging process. It requires financial discipline, careful planning, and the right guidance. By following these seven tips, you can make informed decisions, avoid common pitfalls, and secure a property that meets your needs and budget.
Remember, your home is not just a financial asset; it’s a space where memories are made and dreams are nurtured. With the right preparation, you can navigate the complexities of Nigeria’s real estate market and achieve your goal of homeownership. Contact us today at Dapo Olaiya Consulting to guide you through this challenging but rewarding journey.
