How to start investing in real estate with little money and how to become a real estate investor and become rich has been one of the most asked questions over the years, this is quite understandable.
Real estate investing has produced more wealth to investors than any other sector throughout history and yet many people remain skeptical about entering the business probably because they think they need large capital or maybe because of their past bitter experiences in property purchase.
When it comes to making money in real estate investing, there are only a handful ways to do it and you can get started with the little you have and by engaging professional realtors that know their onions.
In this piece today, I’ll be talking to you about 3 awesome ways you can build wealth, over time, by investing in real estate in fast developing areas in Lagos state, Nigeria.
How to Make Money in Real Estate Investing
How much can you make investing in real estate is not a question with one straight answer as it comes down to some factors like the number of your investment and importantly the location of your real estates.
Below are the top 3 profitable ways of making money in real estate investing;
#1 – Increase in the Property Value
One of the best thing nature gave to us is land and I have never seen anyone lose trading it in this part of the world when done right.
Landed properties appreciate in value and this is what you can capitalise on; it’s what the rich do in other to multiply their wealth because it’s quite useless keeping your money in the bank. Of what use is 9% annual interest your bank gives to you when you can have up to 60% appreciation value in real estate with the right info?
Real estate is all about value. The amount you are buying now won’t remain the same in 5 years to this time.
Let me give you a live example – I love practicals 🙂
In 2014, a piece of land in the Sangotedo area of Lagos state sold for around 5 to 6 million naira. But today, 2019, a plot of land in this area is selling for 15 to 20 million naira. This is a whooping increase in value.
Another example, which has been putting a smile on the faces of my clients that grabbed the offer is Westwood Park Estate in Sangotedo. In 2017, a plot in this estate was selling for N8.4m but at the moment 2019, a plot in Westwood Park Estate goes for N17.5m.
That is N9,100,000 value appreciation on a plot in the estate within just 2 years. Which investment option other than real estate can give you this value? Now imagine if you’ve bought 5 plots of land in Westwood Park Estate Sangotedo back in 2017 for N42m and you were told your investment now worth N87.5m, how would you feel? This illustration is actually a true life story that happened to one of my clients.
So, one of the best ways of making money and multiplying wealth through real estate is to buy land and wait.
Do you know that 20 years ago, a plot of land in Lekki Phase 1 was below N100,000? Today, a plot in Lekki Phase 1 does not go below N120m.
So, while you are waiting to buy land, prices are going up and the smart ones are buying and waiting for you to come and buy them back later. The best time to buy land is now.
But to make this strategy work for you in order to multiply your wealth, you need to consider a few factors such as title documents of the land, proximity to development and its location.
While all the 3 factors listed above are important, location is most important.
If you buy land in Ikorodu for instance, its appreciation rate will be lower than that of Sangotedo or Ibeju Lekki.
For example, if you buy a plot of land in Ikorodu and Ibeju Lekki for N2m today. In 5 years time, this is probably going to happen;
- The land in Ikorodu would have worth about N4m
- The land in Ibeju Lekki would have worth about N8m
What makes the difference? Simple! It’s proximity to great development and location.
So, while venturing into land flipping or long term investment in real estate, location is most important.
READ ALSO: What are the Best Places to Buy Land in Lagos Nigeria?
One of the best ways to make a hell of money with this method is to find property selling way below its original value for some reason or the other and take advantage of it. If you have informed realtors, then this kind of information won’t be far from you.
For example, when the price of land in Amen Estate Phase 2 was about going up, from N12m to N15m, I informed all my clients and some bought into it. The following month, their lands added a whooping N3m in value. If I had that money I’m also gonna do the same. It’s outrageous, yes, I know. But that is the power of information and investment combined!
You should also grab the Amen Estate Phase 2 offer right now before price goes up again. Click here for ongoing promo offer for Amen Estate Phase 2 land and houses.
#2 – Make Money from Rental Income
This is one of the most popular and old ways of making money from real estate investment.
This is done by collecting rent in exchange for allowing people to use your property. If you own a house, apartment building, mall, hotel or any other real estate investment, you can make a lot of money from these investments by collecting rent.
Buy land, build and collect rent from its occupant. It’s that simple and easy!
Oh yes, simple and easy are not on the same side. You are going to learn how to deal with troublesome tenants, broken toilets, a leaking roof and all that but it worth it. You don’t need to worry though as you won’t be taking money out of your pocket to fix anything here. You are still going to use the income from that property to fix whatever that is needed to be fixed.
Another thing you might have to deal with is if you own a mall or office building, you might have to deal with a business that leased from you going bankrupt as they tend to owe you money. You can, however, put yourself off this headache by using the service of property managers (a.k.a caretakers) to manage your property and take rent on your behalf. They charge about 10% of the total yearly rent, it’s not that expensive if you ask me.
READ ALSO: Is Investing in Rental Properties the Ultimate Way to Succeed in Real Estate Investing?
But the good news is that there is a lot of money to be made from this method of real estate investment. Let me share this sweet experience with you.
I was once in a gathering where someone shared his personal story with us, of how he and his only brother became stinkingly rich as a result of a property that their dad left them. They both inherited a twin building from their father. The land was bought many years ago at Ikoyi when it was still a slum (imagine how much it would worth then) and the building was constructed by a developer on a contract basis (developer build, manage and collect rent for a certain number of years before returning the property to the real owner).
Many years down the line, the same property paid for their upbringing, education abroad and so on and when they decided to sell it, over N350m came to this young man. He further re-invested the money in real estate and business and today real estate is still paying his bills.
For we that our fathers do not have the luxury of building luxury houses years ago, we owe it to ourselves to do the right now by investing in real estate for the future and for our children.
And one good thing about this method of making money from real estate investing is that, as the property appreciates in value, so is the rent. This is why landlords increase rent in few years interval. And this passive income from your real estate investment does not expire as long as the property stands; it is a lifetime income generating assets!
Me, as an example, still collects rent from a house somewhere in Lagos where my grandfather built a tenement house. So you know, he collected rent in his lifetime, my father also collected rent for years before he passed away (oh I know what that money did during my school days) and now I am collecting rent and my children will also collect rent from the same property left by someone they don’t even know.
Real estate is the sweetest investment and you need to get started investing in real estate now if you haven’t started already. If you have started, keep investing, it’s never too much. One good location to invest for a great return on your investment is Lagos. Click here to see land for sale in good locations in Lagos state.
#3 – Making Money from Business Operations
The third way of making money from real estate investments in Nigeria involves special services and business activities.
You see, one good thing about lands especially is that it doesn’t need any serious maintenance or servicing. Once it’s bought, it keeps on increasing in value without you spending any dime on it again to keep it.
So, while you are waiting for a few years for your land to appreciate and sell off, you can actually make some money by allowing some business activities to be done on your land. This method is as well great for securing your land to be resold by land grabbers.
For example, you can lease your land to a car wash business if the land is close to the road or development. You can also lease to panel beaters if it’s not so close to the road.
You can even lease your land to be used for temporary event center using canopies. Nowadays, with a lot of owanbe parties especially in Lagos, Event Centers make money every weekend, especially in Lagos. If you can’t do the business, you can lease your land to those in the business and let your land keep generating income for you every year.
If you own a shopping mall, you can have an ATM machine installed (if that’s allowed) and charge for it.
If you own a petrol filling station, you might rent out offices to business owners or even offer parking slot for some token.
There are so many businesses that can be done on your open land and properties without you lifting a finger and you will make your investment generate a lot of revenue for you while sleeping. In fact, the opportunity to make money from your property can be endless for those that understand the intricacies of the market.
Now you know that real estate investment is the best investment on earth and with the 3 ways of making money in real estate investing, you can define your goals and then choose the investment strategy that best suits you the most.
And once you make up your mind, you will need a professional, informed real estate consultant to help you in your property purchase in order not to lose your hard-earned money to land fraudsters.
Talk to me now on 08036129474 or WhatsApp and let me help you through all your property purchase especially in the Lekki-Ajah-Sangotedo-Ibeju Lekki corridor and I will be happy to help you multiply your wealth through real estate investing.