Due to the economic recession in Nigeria, the value of her real estate has plunged to astonishing depths. However, as one of human’s basic need, a category that includes food and clothing, no matter how much an economy fluctuates, the demand for real estate supersedes.
There are many ways smart investors take advantage whilst the economy is low. Truth is, it is much more profitable to invest in the real estate sector at a time when the value of land assets is low, as this would give great returns for money once the market eventually picks up. History shows economies in recession, almost, always bounce back. The best advice for investors right now is never let this opportunity pass you by.
Similar sentiments were echoed by the Chief Executive Officer of RoxBury Homes, Udechukwu Emmanuel, who says “Active participation in real estates at a time when the value of land assets is low can not only spark off a reduction in housing cost, but could give them great returns for their money.”
Another real estate professional; Oluyemi Mac-Dickson, Executive Director of Merrybells Corporate Services Limited, suggests, “One of the things that cushions the effect of the recession is adequate investment in real estate.” Mac-Dickson also goes on to state that once a recession is announced and confirmed by the government, this also will result in a crash the prices of land and real estate. The deficit could be as little as 5% to as high as 40% or more, depending on the owners urge for capital or to show solidarity with the state of the economy.
The question is, why not buy properties now they are below their market value, make changes or repairs, actions which would undoubtedly result in an increase in value, and then sell said properties once the economy improves?
Better still, why not invest in properties in locations that are home to major economic developments? An example of such location is Ibeju Lekki in Lagos state. This area is in close proximity to ongoing projects such as the Lekki Free Trade Zone and the new International Airport. Naturally, considering these are major economic projects, once completed, the number of people migrating to these areas would increase, resulting in a corresponding increase in value of properties.
The wise investor should be looking to acquire properties now, that can be bought at fairly cheap prices, for they would undoubtedly be sold at double the amount, if not more, in the foreseeable future. With the ever growing value of real estate in Nigeria, investing in real estate not only secures your funds, it generates more. It is one of the safest investments to venture into in times of recession...
Written by Nkanu Esther, Business Development Officer for OZ Property and Development Company Ltd.