How to acquire landed property with little or no money
How to acquire landed property with little or no money
The simplest and easiest method of buying properties is to pay cash. The seller is happy and you are happy. There is no need for extra paper work and security, which you will need to comply with if you are sourcing the funds from a third party. There are no monthly payments and thus, less sleepless nights if you have a drop in your cash flow or lose your job if you are an employee.
However, if you do not have the cash that you need to buy a property, there is no need to be discouraged. All you need is to become more creative and all things being equal, you will eventually achieve your dream of home ownership. There is always a way for those who are willing to pay the price to find it. There are several ways of acquiring properties other than paying the full amount upfront as it is usually the case in Nigeria.
If you have no money at all but you are knowledgeable about real estate, it is possible to convert your effort into a property or properties. Most professionals who work in the real estate sector, depending on the circumstances, can choose to be paid in kind rather than in cash or part cash and part in property. In this case, your equity is what is called sweat equity. Several real estate professionals are familiar with this and can share their own experiences in this regard.
Take the case of an estate surveyor engaged by traditional land owners to carry out a survey of a large expanse of land, but the owners cannot afford to pay his or her professional fees. In most cases, they offer to pay professional fees using the land in lieu. This same arrangement is applicable to all those who are engaged in one aspect of real estate investment or the other. The critical point to note is that it is possible to trade your effort, skill or professionalism for real estate.
Another easier way of buying a property is to team up with other people who are interested in acquiring properties but do not have enough money set aside for the purpose. This is the philosophy behind cooperatives. With small monthly payments, you can become part of a big estate project and benefit from the values that coming together creates. One of the benefits is that when you buy land in acres and hectares, it gives you greater negotiating powers with the seller. It is possible for you to negotiate and be given bigger discounts that may not be available to an individual buyer.
Buying properties off plan is another way to come on board a property investment train. Developers are often pressed for money at the inception of their project. Some have to borrow from financial institutions at very high interest rates before they can commence their project. Thus, it is in their interest to have investors even before they put the first block on the ground. Such an expression of interest in the project that is backed with cash deposit considerably reduces the financial burden on the project. Also quite naturally, it draws several other people to the project. Many developers have several options and concessions available to early investors.
In addition, if you are already investing in real estate you can scale up by trading your present property for the one you desire. Several years ago I was impressed with the creativity of a woman who wanted to buy a property at a strategic location for use as a gas station. She did not have enough cash, but was able to convince the seller to accept two properties that she had in exchange for the difference. She did not allow her limited finances at that time to hinder her dream.
These days, there are several real estate companies that have payment in installment in place to encourage first-time real estate investors. This innovation is making buying a property easier for first time buyers in particular. This method of paying for a property is considerably cheaper than mortgages with their current high interest rates. All you need is to find the right scheme that fits your budget on monthly or quarterly basis, do your due diligence and go for it.
Finally, the principle behind all these creative solutions is that there is a way if you seek for one. Remember that if you negotiate for a fixed purchase price at the start of any of these arrangements, you are going to benefit from the capital appreciation that the property will gain. Many investors have used this principle to cash in on an appreciation that occurred when the project they had bought off plan was completed.
PUNCH