Interested in venturing into the Real Estate Business? Business plan tips for Starters.

Real estate investment in Nigeria has taken a positive trend compared to other business investments. There are many advantages of real estate investment compared to other investments. Income from investment in a property is the rental income or returns on outright sale.

Having your property at strategic locations like city centers, commercial areas, high brow areas, near universities, close to the airport etc, the rental income or return on sales will be quite substantial and the profits will be quicker.

It has also been observed that rental incomes appreciate annually especially in areas where there is quick development,Hence, the property owner is protected against inflationary trends with the receipt of increased rental incomes from real estate investment, which acts as a cushion against mortgage payment which will not undergo a change due to inflation.

Property investment or real estate investment appreciates over and over again and as  mortgage amounts are paid off, the equity value of your real estate investment will be increasing. This can be utilized by taking a loan equivalent to the equity value of the property from a financial institution.

This business is highly lucrative, but must be entered into with caution. Choose the properties that are certain to appreciate and further, the properties must have a clear title. If you patiently search, you are sure to clinch such deals. Notwithstanding some small loopholes like property investment scammers, a real estate investment in Nigeria is one of the wisest investments that can get you many advantages on the financial front.

To venture into the real estate business as a start-up, do you want to be a financial investor, a property/real estate developer, or a real estate agent? Whatever position you decide to take, here are just a few tips to guide you and get you started;

1. Create a business plan.

2. Know your target market ie residential, commercial etc

3. Identify the facilities and services your property should have, to meet the needs of your target market/occupants.

3. Draw up your budget and costing plans.

4. Identify your source of financing ie private and equity investors, mortgage facilities, project financing sources etc

5. Carry out a thorough financial analysis to determine your profit and cashflow indices and payback period on mortgages and loans.

6. Carry out a feasibility study to determine the factors that would drive long term continued profitability on your property business, and optimize those factors.

7. Identify the risk indicators to your investment. Getting advice and consultancy services from experts in the property business to advice you on a number of options and how to carry out your business plan successfully with minimal risk factors.