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If you thought you couldn’t play in the property market for lack of sufficient capital, we’ve got good news for you. There are ways you can still participate in the lucrative property market without owning tonnes of money. If your case is that you can fund it but haven’t plugged in because you can’t figure out what direction to go, we also have a searchlight to beam for you.

Globally, real property investment remains a strong and profitable option and provided you apply basic rules of prudent investment, you are unlikely to fail colossally. More probably, you will meet with remarkable success and build a solid wealth base.

Historical Performance
A decent number of the world’s richest people, you probably know, build their wealth in real estate. More importantly, many started small and grew big over time. Their successes have been owed more to strategy than their capital outlay. The implication: even without much money, you can replicate these successes by applying same or similar strategies or, better still, developing an effective self-crafted approach.

Getting Started Your Own Way
If you accept that there is no good justification for excluding yourself from the high-yield property market, here are some six tips on how you can flag off your participation, on your own terms.

1. Invest In Property Companies
This is perhaps the easiest option, especially if you have very limited funding at your disposal: buy into companies that invest in real estate. For the quoted companies, this is a hassle-free process – you just buy their stock on the stock exchange. The key attraction here is that this option is ultra-empowering, enabling even a student that has just N5,000 to become a real estate investor. Other attractions: the company you buy into is run by a management that has relevant expertise and a pool of resources to invest even in costly but highly lucrative property businesses, indirectly giving you a bite into these otherwise exclusive market segments; if your investment fund is managed by a fund manager (by direct placement or by investing in a dedicated managed fund), you enjoy another level of expertise and diversification: the manager can switch funds based on the performance of the property companies.

If you are going for quoted companies, your two major options today will be the UACN Property Development Company PLC (a developer and investor) and Union Homes (a primary mortgage institution financing housing projects and often co-investing).

2. Land Flipping
For reasons of limited funding or pure investment strategy, land flipping may also prove a lucrative engagement for you. There are those who focus on this investment channel: buy land in up-coming areas where you foresee future growth and price appreciation and dig in and wait. Often the result comes quickly, while in other cases, a protracted wait may be required.

If you choose well, excellent (sometimes outrageous) returns will be your reward. Today, much of the land lying from Aja to Epe in Lagos has been bought off, though largely undeveloped. Many of the owners have no ultimate plans to develop and are merely waiting for the right moment and price, knowing that the area will continue to record a more-than-average pace of growth.

If you choose to pursue this course, a word of caution. Land title, especially when you fail to develop promptly, could get slippery, particularly in high-demand locations like Lagos. Be sure you deal with rightful owners, and perhaps in a collective context (a group of buyers). A good lawyer, versed in land matters in the area of your interest, will also be a good safeguard. You may also effect some minor development, to secure effective possession, over the waiting period.

3. Buy And Renovate
To minimise your outlay, you may also target fairly worn or even dilapidated structures which you can secure at a bargain price. If you buy right, the cash outlay plus a reasonable cost of modest renovation will still leave you at a comfortable investment cost. Most times, that modest renovation you carry out will turn the property around and catapult the value. You can exit quickly, having made a decent margin.

If you go on this option, a key factor to watch is the cost of required improvements. If you grossly underestimate this, you could end up with a huge hole in your pocket. The lessen: get reliable professional assessment of the scope of deterioration and the necessary scale of restoration work. Cost carefully, adopting a worst-case approach, to determine how much to factor in for renovation cost.

https://www.financialdigest.com.ng/real-property-2/