How To Begin A Real Estate Business in Nigeria: 6 Crucial Steps
Shelter will remain one of man’s basic needs, making real estate a thriving business in any part of Nigeria. Many people seek to begin a real estate business in Nigeria, but they cannot profit and scale their business because they don’t have the right structure or experience in the market. Profiting from real estate is financially and emotionally gratifying – you know you’re giving people access to quality accommodation that will comfort them while you’re also getting paid for it. Before we venture into the steps you need to take when you want to begin a real estate business in Nigeria, in this article, we will discuss the real estate market in Nigeria, its growth over the years, and the entry points for interested real estate investors. Why Start a Real Estate Business in Nigeria? In 2014, Reports had it that Nigeria’s real estate market had a value of N59 trillion. This was four times higher than the Nigerian stock market, with a value of around N12 trillion. But it’s currently estimated to have a value of US$2.61, of which residential real estate holds the largest share. According to the Development Aid, Nigeria has the world’s highest number of homeless people, making it about 24.4 million homeless people in Nigeria. This number accounts for over 13% of the country’s population. While poverty might be the underlying cause, all shelters don’t need to carry the same luxury, as people with less financial strength cannot make a purchase. The truth remains: more people are seeking to purchase their own houses wherein they don’t need to pay any more rent or share certain utilities. And with the population increasing and people establishing new businesses, those who move fast in this business will take all the rewards. With property rates surging, now would be a good time to begin a real estate business. However, you must bring in the right team and establish an excellent business structure. You can also thrive faster when you avoid certain common mistakes. READ MORE: TOP 10 REAL ESTATE COMPANIES IN NIGERIA How To Begin A Real Estate Business in Nigeria in 6 Crucial Steps #1. Create A Solid Business Plan Without a business plan, your business cannot scale. A business plan represents your desire to scale or increase your offerings in your industry. Many business owners start a business without a plan, and therefore, they struggle in certain situations. In creating a solid business plan, you need to integrate entry points, investment opportunities, market penetration techniques, and a lot more. Introducing a business development coach to help you create a great business plan is a significant move. #2. Gain Your License To enter the real estate business, you must get the right and complete licensing from the respective bodies. In Nigeria, your license has to come from the Lagos State Real Estate Licensing Body if you operate in Lagos state. In contrast, other states require you to present your minimum educational qualification, CAC registration, and means of identification. After you have submitted these documents, the licensing body will review all of them and grant you your license after a few days. With your license, you will avoid harassment from local dwellers whenever you want to enter a transaction with them. #3. Register Your Business Registering your business is a necessity. You won’t get a license to practice or begin your real estate business in Nigeria without proper registration. The body responsible for registering businesses in Nigeria is the Corporate Affairs Commission (CAC). Registering your real estate business in Nigeria is now easier on this platform. Instead of constantly oscillating between your office and the registration body with piles of paperwork, you can upload them to their website. If your documentation is complete and your chosen business name is available, your registration will be complete as you get a code. #4. Raise & Invest Your Capital Anyone wanting to begin a real estate business must have the capital to get his plan running. The real estate market has such a prime entry point that you would need a certain amount of money to penetrate, except if you want to start at the lowest strata. Finding investors for your real estate business is easy, as many investors already understand the profitability and security involved in the real estate business. So, ensure you have a solid pitch and the right answers to every question that investigates the strength of your business. #5. Get The Right Team We can overemphasize the importance of teamwork. In building the right team, you need a perfect blend of people with fundamental and technical knowledge. The fundamental folks will help you create the structure, while the technical folks will help you design it. Therefore, start searching for the right people to fill in the gaps in your world-class team. A good place to begin your search would be LinkedIn. #6. Build Your Brand People relate to a brand, patronize a brand, and stay loyal to a brand. Hence, to scale your real estate business, you must strive from being only a business to becoming a brand name. You can start this journey by constantly spreading a message that resonates with your target audience. Introducing taglines, understanding and using the right social media tools and platforms, and creating delightful offers are activities you can implement. Common Mistakes To Avoid In Real Estate Business Many failed real estate businesses started and went down the mud because they couldn’t avoid certain mistakes. While mistakes can help you understand certain processes, some teach you that at a price you cannot afford. Hence, when you want to begin a real estate business in Nigeria, some mistakes you should avoid include: #1. Excessive Borrowing Borrowing money to start a real estate business in Nigeria is a bad idea. And to make it worse, when you borrow an amount that is difficult to pay up, you will encounter tremendous difficulty paying back your loan. The real estate business thrives on time. The business’s profitability is largely based on your