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One of the most lucrative long term part of real estate, is the rental property sector, this is because, a rental property in a good location, and well maintained will generate money continuously for years to come, as opposed to outright sale.... https://twitter.com/DrJoeAbah/status/1340230741305815041
...which is majorly operated by most estate developers in major cities across Nigeria.
Now if rental property is long-term more lucrative, why is it majorly avoided?
Rental property is majorly avoided in Nigeria, because of the stress involved, such as debts...
Now if rental property is long-term more lucrative, why is it majorly avoided?
Rental property is majorly avoided in Nigeria, because of the stress involved, such as debts...
...search for tenants, getting the right tenants etc as opposed to outright sale where I no longer have to deal with all of these.
Also the ease and comfort enjoyed today in the out right sale of properties, was because of the introduction of mortgage...
Also the ease and comfort enjoyed today in the out right sale of properties, was because of the introduction of mortgage...
Which allowed a lot of Nigerians become house owners over time, this affordable option, created more room for investment and growth in the real estate sector, but also created negligence to the tenancy aspect of real estate.
A fair 80% of Nigerians who own houses today, rented one before, and a fair 70% of tenants today have owed or currently owe rent.
This is largely because of the lack of affordability in tenancy, and also the lack of an alternative to yearly tenancy, as seen in outright sale...
This is largely because of the lack of affordability in tenancy, and also the lack of an alternative to yearly tenancy, as seen in outright sale...
So if I can't pay up my rent at once, I can't afford an accommodation, and how does it affect the job rate and the economy?
Here's an example...
A young man from a below average home is offered a 70,000naira monthly pay job in Abuja, this is supposed to be good news
Here's an example...
A young man from a below average home is offered a 70,000naira monthly pay job in Abuja, this is supposed to be good news
But he has no direct contact to stay with in Abuja, and his family cannot afford to give him 300,000naira to afford a decent accommodation in Apo (excluding all charges and furnishing), now this young man has only three options:
Get a loan
Ignore the job offer
Squat...
Get a loan
Ignore the job offer
Squat...
Now if he takes a loan, he'd be struggling just to pay back this loan, while still saving for the coming Rent, if he rejects the job, he'd be back to the already high market of unemployed Nigerians, if he finds a place to squat, the landlord looses a potential tenant.
All these problems would have been solved if there was a monthly tenancy plan (although there's one now) it means this young boy would be able to pay his rent as he earns there by giving him a more affordable option of 25,000naira monthly as opposed to 300,000 yearly.
My name is Ekene Ossai, and I own a property tech company aimed at creating simplicity, affordability and comfort for both landlords and tenants.
One more thing, the monthly tenancy plan, is also a solution to the harsh dog eat dog system going on in the agent business today. The messy situation in the agent business is simply because everyone has to eat out of a single plate.
