Nigerian Real Estate: The risk of risking
The crypto market hasn't been kind to my portfolio. Then again, you're only as good as your portfolio, so I'll rephrase that to I haven't been a good trader, so I'm suffering.
That said, the fact that my entire investment strategy hinges on the whims of Ponzi hungry traders looking to make a quick buck is unhealthy. I've given it a good thought and decided that I'm going to delve into long term holdings in real life.
I may be away from Nigeria but I'll never cut ties from the country. Other than the fact that it's home to most of my family and loved ones, it's a land rife with opportunities, if you're willing to snatch it.
Think of Nigeria like a volatile crypto market. There's massive opportunity to make a lot of money and on the flip side, you can also lose a lot of money.
I've been doing some research into investment opportunities in Nigeria and one that I have found to be incredibly lucrative is real estate. It has some similarities to the first world concept of it but there are differences.
So, in Nigeria, buying land is still an option and you don't have to be a mega rich corporation to do it. Plots of land are still easily purchasable.
The crazy thing about real estate in Nigeria is that it's not currently regulated. This means, land lords can charge crazy amounts for their property to developers looking to profit off the land.
Nigeria is still developing as a country. There are many parts of the country that don't have roads running through them and things like that. So, this effectively means that you can buy land in areas that haven't seen development and then just wait.
From my investigation, things like roads, airports, schools and even religious houses being built around your property have significant impact on the value. So, for example, a school or airport in the area means there will be road leading to the area which in turn will lead to an increase in property value. Now, the real moneymaker in all this is that you can mark up the property value to any amount you want because it is not regulated.
It sounds simple but obviously, it's not always straightforward. It's a risk that you're taking and hoping on.
For example, what if development doesn't come to that area in your life time. It is the equivalent of holding on to a meme coins that never pumps.
Other risks could come from communal disputes and things like that relating to the land you buy.
There's also the risk of buying fraudulent land. Basically, the realtor sells the property to you and a few others then bounces. You may eventually get your money back but it's a long and drawn out process that you simply don't want to get into.
Ultimately, one has to be strategic about where and how they buy land. I want to do it as a medium term business where I buy land, hold it for a few months and then flip for profit after minor developments on property.
It is risky business but really, which business isn't. I'm still researching for now and saving up funds towards the plan. We'll see what the future holds.