THE PROPRIETY OR OTHERWISE OF THE CONSIDERATION OF LOCATION IN PURCHASING LANDED PROPERTY IN NIGERIA

• Sometime in the not too distant past, I was informed by some of my friends that there were available plots of land at a particular location for a ridiculously small amount, I became suspicious. Like you know, in Nigeria, price determines quality. When I was told of the location, I laughed at the idea. You would not believe it was one remote, uninhabited part of Lagos state that is best for farming and farmers. I told my friends they could go and live in the bush but not me. I go to my village only once in a year. I asked them when they think that area will be inhabited by human beings. Anyway, they can choose to change their profession to farmers. That was like yesterday. Today that is the area called Magodo/Shangisha where a plot of land sells for over N50 Million Naira (Fifty Million Naira). I presently live at Akute in Ogun state.

• I was looking for a commercial area to build a business. In the course of my search somebody told me that I could get a plot of land at a particular location for about N10, 000 (Ten Thousand Naira) if I remember correctly. When I was told of the place, I took a second look at the person and asked if he thought I wanted to raise an animal farm. I declined. Today I pay over N1, 000, 000 (One Million Naira) per annum as rent for a small shop at that same location where I could have been a landlord and collecting rents. That place today is Allen in Ikeja, which eventually became the seat of power.

When someone approaches you or informs you of a land for sale, what is the first question you ask? It is the same anyone would ask- where is it located? That is our first concern as prospective buyers. The above narrated stories are true stories of people living today. How suitable is the argument that a location is too distant or far or the area undeveloped? (I prefer to use the word- developing). We shall consider this under the following headings-

• Scarcity of land
• Rapid development
• Distance
• Investment opportunities

Scarcity of land:

Land can be considered scarce for two reasons. Firstly, you cannot get available landed property in areas you desire because of development. Consider a place like Obalende, Ikeja or even Ojodu Berger where all you see around are developed properties with hardly any space for even a garden. Shops are even built very close to the main roads simply because all the spaces have been taken up and developed.

Secondly, if you are able to get an available landed property, it is so expensive that it is far above the reach of the average man. Let us consider a monthly income earner of N250, 000.00 (Two Hundred and Fifty Thousand Naira), although not up to 30% of the Nigerian populace earn up to this amount. If he decides to buy a property in Ikeja which goes for about N120, 000, 000.00 (One Hundred and Twenty Million Naira) and sets aside N100, 000.00 (One Hundred Thousand Naira) monthly for that purpose, it will take him 100 years to save enough to buy a property of that value. He may have to steal or expect a miracle of some sort to be able to buy it. What some of the very wealthy do is to buy developed houses, demolish and rebuild, but how many people can afford to do this?

So what should the average Nigerian do? You need not wait till you get your pension or win a lottery to be able to acquire a plot of land in a developed area. The good news is there is plenty of land within the reach of every member of the society where people fail to look. Such land is available, affordable and one does not need to have all the money needed at once to purchase such a landed property. The location of this land shall be considered under the next sub heading.       

 Rapid development: 

Having known that land is available and affordable; one other major consideration by intended vendors is how developed the area is at the present. Like in the stories above, people will most times consider just the present, forgetting that we are gradually moving into the future. The developed areas we see today were initially more undeveloped than the areas we consider undeveloped today. One of my relations once showed me my mother’s original village. It was in the heart of Benin City. Development overtook the village and the village ceased to be. Ask your fathers and they will tell you that the cities you see today were once villages and the villages you see today are soon becoming cities. There was a time when Ikeja was not considered part of Lagos State by some. Lagos state was just the ‘Lagos Island’. Anyone stopping at Ikeja, years back was most probably a rail worker. Today, Ikeja is the seat of power. Even when Ikeja started opening up, Allen was still considered “bush”. Today, only the “high and mighty” can afford a property at Allen or even rent a 3 bedroom flat.Every summer, hundreds of thousands of happy children look forward to their parents taking them to Disneyland, a place of fun and wonder, but do you know the story behind Disney land? Walt Disney had a vision. It was a vision of a place where children and parents could have fun together.

The more Walt Disney dreamed of a "magical park," the more imaginative and elaborate it became.

Location was a top priority. Disney thought the perfect location for his vision would be within the Los Angeles metropolitan area, and accessible by freeway. The search for the best spot finally ended in the rural Anaheim, California.

Even though Walt Disney wasn't able to see how his park and his company prospered and grew into the 21st Century, his legacy still lives on with us. Throughout Disneyland and throughout the entire world, he will always be there.

 The area called Mowe was non-existent few years back but with the establishment of the Redeemed Christian Church of God (RCCG) Camp when the area was more of a forest, Mowe has become a city with very modern houses. All those who never dreamed of staying in a place like Mowe now have their mansions built there while they drive to work in Lagos every day. Some of the best schools, universities and residential estates are today located in these areas. For example, Day Waterman College, an international school is located after Siun at the Lagos-Abeokuta Expressway. 

 Development is spreading everywhere like wild fire. Some of the previously undeveloped areas are becoming more developed than some of the previously developed areas. This is because there are better housing plans and structures today than it was yester years and more are still evolving.   The best houses and structures are yet to be developed and will be located in areas where today may not seem too developed. Soon the structures you see around will be incomparable to the ones that are springing up in areas considered undeveloped.

 Another concern of intended subscribers is when the place will eventually become developed or habitable. Let us consider this illustration: think back of what you did when you were in your senior secondary school. Can you remember something interesting that happened? Alright, what about when you just entered secondary school? What about when you were in primary school? How many years ago was that? 5?, 10?, 20? I remember when I was in primary 4 and even before. That was 1986. How time flies. Yet it is as if it happened yesterday. The 10 or 20 years you are talking about is just at the twinkle of an eye away.

 You sleep and wake up and you already have grand children and all the surrounding villages have turned into cities. If eventually they ask you why you are still on rent what will your reply be? That you were waiting to get all the money before you purchase a plot of land when there were opportunities to pay in installment? Or that you were waiting for the area to develop but did not realise it when development eventually overtook you? Time flies. 

 Distance

Time is relative and so is distance. This is what I mean; if you are with your wife or a loved one, time will seem to fly. You will think you have been talking for 20 minutes when actually you have been talking for 2 hours. The same thing applies to distance. When you are enjoying the journey, you are seeing things that interest you along the road or there’s something to keep you busy, the journey would seem to be short.

 Would be subscribers sometimes consider a developing area a far location simply because it is still developing. Areas which hitherto were considered far were later found to be not too far. Ikeja is no longer far from Victoria Island. People today can run to Lagos Island and back on the same day. Few years back, there were only a handful of people staying at Lekki. From Lekki people moved to the neighbouring Ibeju Lekki and from Ibeju Lekki people have started staying at Ajah. I am talking of people who work and spend all their day in Lagos. As I write I am quite sure that there are developing estates after Ajah. The distance does not seem too far any longer.

 Most times, people measure distance in terms of development. For example, one would consider a journey from Ibadan to Lagos a long journey but not Ikeja to Obalande, not realizing that it is almost same time duration. The developments that began to spring up in areas along the Lagos/Ibadan Express way like Cara, Opic, Arepo, Magboro and then to Ibafo and Mowe eventually showed that those area are actually quite close to Lagos. Few years back before the Redeemed Christian Church of God Camp was sited at Mowe, Mowe was seen as a distance that could be referred to as the end of the world. But today, 70% of the people that stay at Mowe, work in Lagos and as far as to V.I. It will interest you to know that some even live at farther distances like Sagamu. This is what is obtainable in foreign countries like London where some people live in north London but work in East London.

 Another interesting thing is that most times, roads leading to these developing areas are less traffic prone than highly developed areas because they are less populated. So if one include the time spent in traffic jam in developed areas, one will discover that journeys around developed areas takes much more time than journeys around developing areas. For example, it takes less time and less stress from Siun to Lagos Island than from Ikorodu to Island especially with the six land way expansion being carried on the Lagos/Ibadan expressway.

 Investment opportunities 

The idea of investment is that you buy when the price is low and sell when the price is high. On another hand, especially when it relates to property, you buy from an area with a low price and with a projection of the price appreciating fast as a result of rapid development, and when it does; your property is worth much more the value you bought it.

 Developing areas provide a very good investment opportunity. Land speculators know this too well; that is why they buy landed property at areas that are developing, leave it for a while and then sell much later when the value have increased as a result of development. There are people who will not buy until the area is developed; these people will constitute the future market for today’s investors.

 Do you know an interesting fact? Wherever an estate is located, the value of land around that area is bound to appreciate, most times faster than other areas. A good example is the Magodo Estate in Ikeja, Lagos State, Nigeria. Before the estate fully developed, landed property at a developed area called Ikorodu, was much more in price than landed property around Magodo but as the estate developed, the reverse became the case. While a plot of land today at Ikorodu still sells at Two Million Naira (N2, 000, 000) or even less, depending on the particular location, a plot of land sells for about Fifty Million Naira (N50, 000, 000) around Magodo estate.

 Apart from buying for the purpose of resale, another form of investment is buying for one’s future generation; that is, investing in their future lives. Before these children grow up, the prices of landed property would have appreciated greatly that they may not be able to acquire any for themselves. The area would have similarly developed into ultra modern cities. Having landed properties in such a place will give them several good business opportunities ranging from building and letting out offices and residential houses, building personal businesses apartments and also having houses for themselves. “A good man leaves an inheritance for his children’s children…”   Proverbs 13:22 (The Holy Bible). 

 Conclusion

The time to act is always now and not tomorrow. Investment is not when you have enough. It is a deliberate and conscious effort of sacrificing a part of your income for the purpose of a greater future profit. Real property is the best form of investment. Real estate companies have given the common man in the society the opportunity of owning landed properties by paying in installments over a period of time. All you have to do is ensure that you are dealing with the right sect of people and that they have genuine title to the property and that you will get value for your money.

Take that step today. Begin payment for your land and the future is yours.

written by:

Philip Ighofose

Propertylink Real Estate Investment Limited