ghanaadvantage.com

Real estate also allows for a global playing field for any interested investor regardless of status, nationality or educational background.

The Group Managing Director, Xpress Property Services, Mr. Segun Alli, says that easy money can be made with proper study of the property market and available funds, especially in off plan purchases and property flipping.

According to him, starting a real estate business will depend on the level at which one is beginning. It may be as a one short investment, creating a portfolio or as a profession. But whichever level, one decides, good study of the property market globally is the best initial investment to make before financial commitment. However, depending on the country one chooses to invest in, a bit of cash as equity contribution may be required except where there is no form of mortgages, then a significant amount of money may be required to get started. In summary, one’s financial liquidity will determine his entry level and no fixed amount can be used as a yardstick.

Alli says, “To be a trusted player in the real estate world, integrity is vital and so the issue of regulation remains a good mechanism to enhance public confidence and maintain standard by all players and practitioners. In the United States, for example, to be a realtor, you require both federal and state licences with a mandatory renewal annually and some yearly hours of continuous education, unlike in Nigeria and in some European countries where there are limited regulations and some voluntary membership.

“The best way, however, is to carry out a proper and detailed check on the transactions and players with a lawyer involved at all times. Never deal from the briefcase but with a registered physical office.”

Qualifications required as a realtor depends on country of practice. In the US, for instance, you have to be educated as a realtor and licensed to practise. In the United Kingdom and Nigeria, basic qualifications are required but no active legislations yet to pursue the implementation. However, a good knowledge of existing laws within each market is key.

He says that despite the global downturn in the world property market, especially in the US, there are many good deals available where quick equity can be assured if there is available funds and good understanding of the market. It is always good to work with experienced estate agents as guide to give proper advice and lead.

Nigeria, Ghana, Morocco and Egypt represent a few of the emerging markets in Africa. Countries like Turkey, Cyprus, Greece, Spain and France as well as the Caribbean Islands also control high stake in real estate business. If for example, one buys property off plan, equity will grow even before completion with opportunity to sell at a higher price before handover, thus creating cash turnaround on investments.

Alli explains that one of the best ways to scout for customers is to showcase services and properties in specialised property related magazines and use online property search. It is also good to use services of professionals in the property services market.

He adds that both buy-to-sell and buy-to-let are very profitable depending on location and property situations, pointing out that for quicker returns on investment, buy-to-sell will do better and that buy-to-let will probably ensure a more regular cash flow and more equity, although it takes time to build up and risk exposure may be more unless close study of market situations is observed.

He states that one can start real estate business individually and still succeed but as a practitioner, the vision and size will depend on manpower needed for effective operation.

According to Alli, the challenges in real estate are numerous as much as the rewards. But the greatest will be market situations and available funds either as liquid cash or borrowed funds, especially in the current global credit crunch environment and the down trend shift in property market.

The Chief Executive Officer, K777 International Limited, Mr. Kola Adiji, says real estate remains a strong and profitable investment globally. He states that history has shown that a substantial proportion of the world’s wealthiest people have had real estate playing a crucial part in the accumulation of their fortune.

Adiji says there are investment options open in real estate.

According to him, “For pure investment strategy, with about N500,000 you can go for land speculation. Buy land in up-coming areas where you foresee future growth and the price appreciates in no distant time. But you need to choose well and involve a lawyer, who is versed in land matters to safeguard the transactions. You can also target fairly worn out or dilapidated buildings with proper sense of price bargaining power. This yields high profit margin on your investment. But you need a reliable professional assessment, while taking this option to minimise cost.

“You can buy and redevelop. This creates new value for your market. You can focus on commercial development, such as stores, shopping complexes, office space, warehouses, etc in strategic business areas. So, also, you can invest in accommodation.

“Cities like Lagos, Abuja and Port Harcourt and other commercial capitals have the ratio of buildings to the population very low. Therefore, residential accommodation will remain a good option for a long time to come, since the government is not proactive in responding to the situation.”

He, however, warns that one needs to be motivated, focussed and determined to achieve the desired success in the business.

Source: The Punch