Why Appreciation On Property Will Not Wait For You
Opeyemi Quadri
Generative AI Trainer | Web Content Creation | Volunteer Wikipedia Page Writer & Editor
A few months ago, one of the properties in my portfolio at Okun-Ajah, Lagos State, was selling for N15,000,000 (500SQM).
A few days ago, I got a notification from my partner that beginning from July 11, 2021, the same 500SQM would start selling for N20,000,000
To me, three major things can be attributed to the impressive appreciation apart from the fact that real estate (property) rarely depreciates.
They include:
1) Location
2) Demand
3) Value of Naira
Location:
Ajah axis is one of the sweetest investment destinations in the city of Lagos. Some of those who work at the Dangote facilities, Ibeju-Lekki, leave around Ibeju-Lekki, Ajah, Lekki axis.
Demand:
In economics, demand is a price-determining factor. Scarcity could set in if demand skyrocketed beyond what supply can suppress.
That’s exactly what we’re witnessing in the case of the property at Legend Bay Okun-Ajah, Lagos. The few available plots are now available for those who can pay more. It hasn’t even reached its peak. The same plot of land could worth N30M or more in the next two years. Quality and exquisite apartments in that axis are in high demand
The value of Naira:
To appropriately evaluate the alarming inflation on the prices of goods and services, one needs to deeply look into the role the exchange rate plays. The FX is a factor.
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As at last check, a US dollar was selling for N503 in the market. That’s what you get in an economy that uses most of its earnings to service debts.
How does this affect real estate or goods that aren’t imported?
Simply put, when the value of the naira nosedived, it’s “natural” that provider of goods and services, and sellers jack up their price to fill in the gap of what they’ve loss in the value of the naira against the dollar.
My points:
Appreciation on land waits for no one. Whether you're planning to buy or not, there is no time. It's driven by location and demand, and the foreign exchange (most especially in major cities that experience an influx of foreign investors ).
You will pay more if you procrastinate. You may pay X2 if you blink. You blink, you pay more
A friend once said, “Even if I delayed, my prayer is to have the money to buy whenever I’m ready.”
While I said aloud, “AMEN”, what if you invest now and make more money on your investment tomorrow?
What are your thoughts on this?
Happy New Month!
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