One of the oldest real estate investment strategies in Nigeria is FIX AND FLIP. Fix and Flip is a strategy that allows you to buy a dilapidated or old property, usually a house or shopping complex, at a lower price and sell that same property at a higher price after renovation. This strategy is commonly practiced by the older generation of real estate investors, and it is a widespread practice across many parts of Nigeria.
To start a profitable house flipping business in Nigeria, you need to have basic knowledge of property valuation, or you can work hand in hand with a property management company in Lagos Nigeria the have affiliation with a law firm like Shelter Professionals Limited. Having first-hand information on what kind of properties to buy and where to buy them will set you up for success and help you avoid the Cons of this investment strategy. So here are some tips to help you get started.
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If It Is Not A House Or A Shopping Complex, Do Not Buy It: It is easier to buy, repair, and sell a shopping complex than to buy and sell a church or a mosque. Avoid any property with strong sentimental value to its immediate environment because those properties are often hard to sell. Sometimes, they may attract lawsuits, especially in cases where the land on which the building stands was gifted and not properly documented.
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Location Matters: Always research the location before you buy a property. It is advisable to consider factors such as accessibility, drainage, security, infrastructure, amenities, and demand for properties in an area before you buy a property in that location. Buying a property in a good location can significantly increase your profit margin.
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Documentation: Ensuring that a property has accurate and up-to-date documentation can never be overemphasized. You do not want to buy a property that will attract lawsuits with many back and forths. If the ownership of a property is not clear, do not buy it.
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Don’t Buy On Sentiments: Put your emotions aside when you are buying a property to flip. Many people buy properties from friends and relatives that end up putting them on emotional blackmail during the process of fixing and flipping. You might lose friends if they realize you made a lot more on the property than what you paid them. In general, avoid factors that can hinder you from making logical decisions.
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Never Overspend: Always calculate your cost of repair before you seal the deal on any property. If the cost of repair plus the purchasing cost is higher than the average value of a standard property in that location, do not buy it. Many investors have fallen into the trap of purchasing a property that needs a lot of repairs, only for them to fix it to a desirable taste and then realize that there is no demand for the property or the demands are not favourable.
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