I'll try my best to answer your questions on the subject matter above:

Could anybody knowledgeable about the process of registering and operating a real estate agent outfit in Nigeria shed some light on the process and requirements. Specifically the following:

Generally i believe there is no act or law that supports the group called "real estate Agent" but the Nigerian institute of surveyors and estate valuers are generally considered the right group or professionals to handle real estate transactions in Nigeria, but since most of them are kinda uptight and restricted in their practice, alot of people or groups have began to operate as minor low scale realtors to help people and attract clients who want to buy and sell properties on a low scale level without the need of professionals.

The advantage is that transactions are done very quickly, clients dont need to pay exhorbitant professional fees and the word of mouth travels very fast amongst fellow real estate agents.

The disadvantage is that it is a very risky proposition for a client to deal with real estate agents because beyond the sale and minor transactuons, they cannot professionally evaluate a property and cannot inolve themselves in conveyancing matters and most especially they cannot be held liable for any defect in the sales of property hence the rule "caveat emptor-buyers beware" because they take the money and split after the sale.

Are there any Federal Govt specific requirements ?

Are there any State or Local Govt requirements ?

I am not sure whether they have an association or not and i know the state government taxes them as regular small businesses but on a professional scale, i dont think there is any requirement whatso ever.

Is one obligated to register with a professional body - if so which ?

The known body is NIVES-Nigerian institute of estate surveyors and valuers

Is there a need to have a lawyer on the company's staff to handle sales/lettings contract?

In house lawyers to companies or businesses are generally prohibited from handling such matters and after some time the lawyer might end up stealing most of your clients since he can do both the sales and conveyancing. The best advise is to hook up with one lawyer and while you contract for sales and purchases of properties, the lawyer does your conveyancing matters and your both happy. You get your 10% from the agency fees and the lawyer gets his 10% for the conveyancing and you dont have to pay extra monthly salaries or commissions

Is there a need to have a quantity surveyor or estate valuator on the company's staff ?

Just like the dos and donts of having a lawyer on your team, the same applies for a professional estate valuer or surveyor. Since he is a professional, he would definately take over your duties and clients at some point. Its best you sub contract these things with a surveyor when there is a need for it and you pay him his commission.

Until you become a master and professional in this chosen field, be rest assured these professionals will take advantage of you if you ever intend to employ them. Just out source when the time comes and deal with your private agency transactions and you would get no hassels.

Hope i have been able to help!!

Cheers!

dnative:

@Lawyer.

Much appreciation to your detailed response.



Please could you clarify if the 10% the lawyer ususally gets is 10% of the agency commission or 10% of the propery sales or letting fees? If it is the latter, would you know how this works out - assuming Mr S has a property he wants to sell to Mr B for -N-1,000 through Estate Agent A. The 10% agency fees, is this paid by Mr S from the sales amount (which means he would end up getting -N-900 after the sales) or is this paid by Mr B before taking ownership of the property (which means he would pay in total -N1,100). Is the lawyer fees the same, is this paid by Mr A the seller from the sales fee, or by Mr B as a total of what he pays for the property and is this 10% conveyancing fees negotiable or non-touchable non-negotiable at the 10%.

Thanks a lot in advance of your response. I need this information to put in perspective a business plan. Thanks once again.

No problem. I'll tell you how it works in Naija:

1. Assuming you are an estate agent and you end up getting Mr A to sell his house and your acting on behalf of him to sell the house through adverts or word of mouth and the property is going for N1,000,000, iF Mr B is interested in that property, he would pay the following:

a. N1,000,000 asking price of the property

b. 10% of N1,000,000 = N100,000 which is the agency fees or money given to the agent for marketing the property on behalf of Mr A

c. 10% of N1,000,000 = N100,000 which is the legal fees given to the lawyer to help draft the deed of assignment and who propably did the required search of the property at the land registry to know if the property is free from defect.

2. So therefore, MR B will pay a total sum of N1,200,000 before the property can be transfered to him. EVERY BODY GETS HIS OR HER OWN CUT. That is what is being known as the total package!

If you have any more questions just mail me at barristermatto@yahoo.com

Cheers!

What if Mr. B has his own lawyer and not willing to use the agent lawyer like I did. Why should I trust the agent lawyer ? Whose best interest is he looking out for ?

ajileko:

What if Mr. B has his own lawyer and not willing to use the agent lawyer like I did. Why should I trust the agent lawyer ? Whose best interest is he looking out for ?

If a lawyer is acting for both Mr. A & B, he is known as a stakeholder on behalf of 2 of them but in most situations, it is the agents lawyer that drafts the conveyance or deed of assignment since he is the one selling or conveying his property to another person. It is only in rare circumstances that Mr B's lawyer would draft the deed of conveyances and especially if Mr A is an illiterate or he doesnt give a hoot about how the deed or title of the property is being transfered as long as he gets his money

@lawyer,
      Thank you for dealing with this subject properly, you are doing a great job.
But i would advise that anybody interested in starting this business should at least go for a tutelage under an established agent for 3 months (weekends will be ok) .You can try Realty point ltd. their office is at onigbagbo House, Maryland.

I got it. Thanks.

thirdeye:

@lawyer,
Thank you for dealing with this subject properly, you are doing a great job.
But i would advise that anybody interested in starting this business should at least go for a tutelage under an established agent for 3 months (weekends will be ok) .You can try Realty point ltd. their office is at onigbagbo House, Maryland.

Your truely correct third eye. Real Estate Business is really an ugly business and not for the faint of heart. To be successful in it, you need to understand the rudimentary of it and understudy pros who live and die for this tough job and are used to a tough environment like naija! We could keep in touch and rub minds together!

Cheers!

Now make trust on the real estate experts, who helps to find new home, sell your current home, orto find commercial real estate. Locally or globally, get where you want.

I greet u all. Please i am a fresh graduate who would love to go into full time real estate business. I really dont have much idea on how to start. I already have a big store which i intend using for the business. Please, i will so appreciate it if anyone can post a breakdown of all i need to do from the point of registring the business to the point of sourcing for clients. Thanks alot for your time.

@lawyer,
Thanks for your exhaustive explanations but I do not agree with you on the issue of the commissions payable.The buyer pays 5% of the price at which he is buying from the owner to the Estate agents who facilitated the deal. Then the Owner of the property pays 10% to the Estate agents and Lawyers.
What you have described is obtainable in leasing agreements.Outright purchase is a different ball game altogether.

Hello. Interesting read. Pls barrister an independent realtor and a while ago some 1 contacted me to get him a property. After bout 3 weeks of searching got him a place.Took him 4 inspection and he liked it. But complained bout d price.He then requested I get him anoda option which I did.I called him and we fixed a time 4 inspection only 2 learn from reliable sources that he went behind me and made payment for the first place I took him to.He has not been picking my calls ever since and has deleted me as a contact on his bbm. What can I do in such an instance to get my commission from this fraudulent client.

lawyer:


No problem. I'll tell you how it works in Naija:

1. Assuming you are an estate agent and you end up getting Mr A to sell his house and your acting on behalf of him to sell the house through adverts or word of mouth and the property is going for N1,000,000, iF Mr B is interested in that property, he would pay the following:

a. N1,000,000 asking price of the property

b. 10% of N1,000,000 = N100,000 which is the agency fees or money given to the agent for marketing the property on behalf of Mr A

c. 10% of N1,000,000 = N100,000 which is the legal fees given to the lawyer to help draft the deed of assignment and who propably did the required search of the property at the land registry to know if the property is free from defect.

2. So therefore, MR B will pay a total sum of N1,200,000 before the property can be transfered to him. EVERY BODY GETS HIS OR HER OWN CUT. That is what is being known as the total package!

If you have any more questions just mail me at barristermatto@yahoo.com

Cheers!

Very Nice and educative thread.

@lawyer
Please i would like to know what happens and probably the breakdown of fees and who gets what when 2 agents are involved (one from Mr. A and the other from Mr. B).
What i mean about 2 agents been involued is that Mr. A contacted an agent to help him sell his property while Mr. B contacted an agent to help him look for a good property.
How and where does the agent commissions come from?

Also, what's your take on abproperty's statement -
"Thanks for your exhaustive explanations but I do not agree with you on the issue of the commissions payable.The buyer pays 5% of the price at which he is buying from the owner to the Estate agents who facilitated the deal. Then the Owner of the property pays 10% to the Estate agents and Lawyers.
What you have described is obtainable in leasing agreements.Outright purchase is a different ball game altogether."

victorybondo:
Hello. Interesting read. Pls barrister an independent realtor and a while ago some 1 contacted me to get him a property. After bout 3 weeks of searching got him a place.Took him 4 inspection and he liked it. But complained bout d price.He then requested I get him anoda option which I did.I called him and we fixed a time 4 inspection only 2 learn from reliable sources that he went behind me and made payment for the first place I took him to.He has not been picking my calls ever since and has deleted me as a contact on his bbm. What can I do in such an instance to get my commission from this fraudulent client.

Did he sign an exclusivity contract with you?

Did he sign an exclusivity contract with you?

Mr Nobody, could you help me out here. I'm about to fall in this same way

reality1:


Mr Nobody, could you help me out here. I'm about to fall in this same way

get a lawyer.