Real Estate investment is a premium investment all over the world, particularly in Lagos. A plot of land in some parts of Sangotedo Lekki Lagos was going for N2million in 2009. You can’t get a plot of land in those same areas for less than N17million in 2019, which is 10 years after. This is why everyone wants a piece of a real estate especially in Lagos. Its a very risky journey on your way to invest. How to avoid being Scammed when buying properties in Nigeria, especially in Lagos. How do you not loose your entire savings while trying to make the investment. We have had several cases of fraud all over Lagos where investors fall prey. Over 500,000 cases of land fraud in Lagos and Ogun State alone annually. This calls for attention to this topic.
In this article, I shall be exposing some tips on how to stay safe during a real estate transaction, which is aimed at making you an informed buyer, due to many inquires I have received from potential investors over the years as a Real Estate Consultant.
1. Have A Budget
One mistake many intending property buyers keep making is not having a budget before they set out to buy a land or a house. No matter the amount you have saved in your bank account, always take the time to research the other fees that are usually associated with buying a land and they always come in these form.
a. Legal fees- 5% of the cost of the land
b. Agency Fees- 5% of the cost of the land
c. Survey Plan- (usually above N100,000-N300,000) Depending on the location of the land and state.
d. Cost of signing the documents- ( A very strange tradition in Lagos but nonetheless something you cannot escape paying)
e. Cost of putting up a fence to secure your land immediately you purchase it
f. Cost of perfecting your documents with the Government at the Land Registry such as a C of O, Governors Consent, Ratification fees, Survey Land information etc.
Once you have done the math to know all these hidden fees that are associated with buying a land, it will adequately guide you on the location and type of land that would suit your pocket.
2. Demand for the Document
Before you make payment for any land in any location in Nigeria, you should ask for the following documents:
- The Certificate of Occupancy (C of O)
- The Survey Plan
- The Tax Clearance Certificate
- The Deed of Assignment
Never make payment for land without the provision of these vital documents. Don’t take anything for granted because this is one way fraudulent individuals exploit unsuspecting land buyers. Many have fallen victim to this scam and several others have found themselves in court contesting ownership of land that they paid for without following due process.
Buying lands without knowing the documents the Seller possesses is like attempting to buy a car from an auto dealer or independent seller without asking him to show you his car papers or even driving licence. You know what will happen to you when you are caught driving without proof of ownership from the previous seller. The same rule applies to buying a land. Anybody trying to transfer land or property to you must show you the documents he executed with the previous owner so as to show proof of Ownership or else anything you are buying from him is a stolen property and it’s as simple as that.
I hear daft stories like, “Oh, it’s my Aunty that is selling the land and I know her or it’s my Colleague at work selling the land so I just paid money into their account because I know them previously”. Really!!! Husband and Wives draw up wills, Parents document gifts they give to their children, why then would you just pay for a land to a non blood relative because you know them previously.
It doesn’t matter if you are buying the land from a friend or a close relative whom you trust. Buying land in Nigeria is a financial transaction and should be treated as such. Always insist on seeing the original copies of the aforementioned documents before buying land in Nigeria. Don’t make yourself an easy target for a scam.
3. Conduct Research to Verify the Land Ownership and Availability
It is not enough to request for the owner’s copy of the land he/she intends to sell to you, it is particularly important to verify the authenticity all the documents that are provided.
Having the documents sent to you is one thing, verifying them is another thing entirely.
There is a possibility of you stumbling on an opportunity to buy land and getting a good deal but don’t get carried away to the point of neglecting the documents. Jumping at a good deal to buy land is fine but you need to be extremely sure of what you are buying and avoid leaving anything to chance.
Ask for proof of ownership. Involve verification experts before you pay for any piece of land. Don’t take anything for granted. The process of land investigation is quite complicated and you should leave it to professionals to do this on your behalf.
4. Ask Questions Before Buying Land in Nigeria
After you have verified the documents, please feel free to ask as many questions as you want. For instance, it is important to know why the owner of the land has chosen to sell the land. Ask if there is any dispute or pending litigation over the land in question.
You can also find out if the land was inherited and remember to cross-check the answers against the documents provided. Make sure the dates also check out. Don’t rely on on what the seller is telling you. Sometimes it is also relevant to consult more than 2 sources around that location. Even if this is not 100% reliable because the fact that people around knows someone to be the owner of the land does not necessarily mean he/she has legal right to sell. But this can prove helpful when dealing with suspected conflict land. It is also advisable to consult community heads as well.
You also need to run a ground check on the owner of the property, the land as well as the documents presented by the seller. The last thing you want is to be stuck with fake documents given to you in a hurry by a scam seller. The last thing you want to do is to pay for land that becomes problematic.
5. Always Involve Professionals in Land Matters before you buy a land
A lawyer, Surveyor, Architect and a Real Estate Consultant, are the 4 most important people you must get in touch with before you buy a land. The lawyer is the only one that can draw up your contract papers legally. Any other landed document drawn up by any other person is null and void and you would not be allowed to process your papers at the Land registry.
A Registered Surveyor is the only one that can draw up your survey plans. Without the survey plan you have no description of the land you intend to buy. The Surveyor can also help you pick coordinates of the land if you are already presented with a survey plan, to help verify if the coordinates gotten from from the survey plan corresponds with what is gotten on the site. Also, to help you chart the history of the land you are buying, to make sure it is free from government acquisition. Use only a registered surveyor please. An Architect is the one who would advise you on the type of house you are to build and the cost of putting up that structure starting from the location of the land down to the type of soil. Don’t do self service. Engage these professionals to guide you properly.
A Real Estate Consultant will give you professional advice on the investment, its value and potential return especially if you are buying for investment purpose. In most cases, a Real Estate Consultant helps organize the entire process and coordinates the activities of other professionals for best result. Click HERE to get in touch.
6. Endeavor to Visit The Site In Person
Regardless of how busy your schedule is, you have to find a way to create enough time to carry out a thorough inspection of the land before you buy it. A growing number of people have been swindled just because they were too busy to carry out a thorough inspection of the land before making payment.
In the case where physical inspections will be difficult due to your location, especially if you live in the diaspora, send a trusted representative (preferably a professional) to view it on your behave. Don’t rely on just pictures and sweet words because there are so many other important things the picture or advert won’t tell you such as the neighborhood, light and water issues, the road leading to that place, amenities such schools or hospitals, transportation ease to and fro, real time proximity to major landmarks, market etc. Make sure you check all these things before you finally commit yourself to buy a land.
7. Documentation and Payment
Take the pain to document every single part of the transactions involved in buying land in Nigeria. Every single part of the deal needs to be documented; from the cost of land to the survey fees.
Documentation is vital for referencing and you should ensure the documents are detailed. Written down transaction details, pictures of parties involved, and even video recordings can go a long way if something later goes wrong.
Anyone who tries to sell you land and is reluctant to show you proof of ownership is as good as trying to sell you a stolen car. Would you buy a stolen car? Documents like the receipt, land survey, Letter of Allocation, Power of Attorney, Gazette and Deed of Assignment must be available. It doesn’t matter if this person is your aunt, uncle or boss at work, a document is a document and there is no substitute for it. A land verification expert can do this on your behalf.
Also make sure you don’t make payment in cash, all land transaction such be done in through bank accounts so it can be traceable. Make sure you are not paying to or through a third party without relevant explanation, because that may be a way the seller is trying to make the transaction not traceable to him or her.
8. Dealing with Omo Onile
There are certain costs that you will incur in addition to the cost of the land itself. In Nigeria, the activities of Omo Onile has become a prominent part of land acquisition in Nigeria.
Omo Onile, by literal meaning, refers to ‘child of the landowner’ but technically, they are miscreants with a powerful network of notoriety within the real estate circle in Nigeria. They are also known as land grabbers.
They have to be factored into your plans to buy land and the reason is simple – They have a way of making things difficult for you if you decide to ignore them.
Omo Onile: You must be wary of thugs, crooks and touts who pose as land grabbers. These notorious entities are to be feared given the horror stories shared by land buyers in Nigeria
Avoid buying land from them. Focus on doing due diligence before you buy the land. This helps you avoid buying land that has already been acquired. Remember to get all documents that prove you own the land including the Certificate of Occupancy also known as the C of O.
To tackle the problem of Omo Onile, the government approved a 21-year jail sentence for anyone charged and found guilty of land grabbing. The Lagos State House of Assembly also pulled its weight by prohibiting forceful entry and illegal occupation of land in a state. If you ever find yourself confronted by Omo Onile, you should gather evidence and forward them to security agencies to take action.
9. Take Possession of Your Land Immediately
As soon as you buy it, try to take possession of it by constructing a small fence around it. You don’t have to do 9 coaches, just 2 or 3 is enough to demarcate your land so that any prospective buyer of the land knows that it has already being bought and should stay clear of it. Pour gravel or sand there, do a well on the site and visit if frequently. Hire a mai guard to come on the land to watch over it till you have money to build something tangible.
Don’t just leave it fallow and expect it to wait there for you when you are ready. Somebody else would end up encroaching on your land and steal it. I am talking from experience and that is how I threw away N2Million which was my total life savings back then when I bought my first land and left it there unattended to for 6 months hoping to come back there to do something when I have raised enough funds, only to see an uncompleted building on it fully fenced with gate man. The same land seller resold my land to another rich dude after he noticed I wasn’t doing anything there and absconded. Let my pain and suffering be your own guide to wisdom so that it won’t happen to you too.
When buying landed properties in Nigeria (especially in Lagos), make sure you put all these tips into consideration and do a thorough research. It is not easy to make money, so before you part with your hard earned money, make sure it is worth every bit of it. Working with a trusted real estate consultant or agent also saves you a lot of trouble as they have more experience in dealing with all that has to do with land acquisition and selling. Property experts will guide you towards buying land in Nigeria and avoiding risks involved.