Thread by @AyoBankole

A few months ago, I shared my story on how we could have been rendered homeless months after my Dad died and our landlord kicked us out, insisting he wasn't renting to a widow. Recently, I met with some young folks who get confused about real estate vs investment options. Thread

I was 16. But that experience influenced the lenses through which I see real estate from the perspectives of an African child from a modest background. Another was the crisis in the early 2000s, where many lost their jobs & many of my friends were kicked out of their rented homes

I've noticed how very easy it is for young folks here to get swayed by popular folks and how they “yass queen, yass king” to every thread that sounds complex & fancy. And MOST times, the writers don’t share the same background with you nor know your realities. Hence this thread.

For me, I see real estate in Nigeria as more of a hedging tool than an investment option. So I see the investment managers who make the comparison here very disingenuous. Let me explain. Over 70% of Nigerians are poor. And the little funds they have can crash in securities.

So the basis of comparing which is better between it & securities shouldn't apply. While diversification is good, investment in real estate and securities isn't an either/or situation. Until you're relatively rich, real estate as an investment option may not be your reality.

This is why Nigeria has a 17-22m housing deficit, yet we have a supply glut in luxury real estate market. There are simply not enough rich or comfortable people to afford the luxury properties being built all over Nigeria. Those who suffer the deficit are those from modest homes.

Our reality is that real estate is a fallback option if anything goes wrong. An asset class that protects you from uncertainties in a country with lax labour laws, zero social safety nets, inefficient property rental regulations, etc. where many move from 100 to zero overnight.

An even bigger tragedy is that income levels are so low that real estate acquisition or development cost is so high for the average working class. A few years ago, I worked on a feasibility study for a multilateral institution looking to invest in affordable housing in Nigeria

for low-income earners, and we discovered that there was no way anyone could build decent housing at profitable rates that low-income earners can afford in the major cities. So how can the average working class afford real estate? By committing little sums into real estate.

That’s why I get excited when I see innovative solutions that leverage tech to help the average young working-class experience the freedom of owning a home. I believe that the government and the private sector are simply not doing enough to address the lower end of the market.

This is what @Octo5co is doing with the STOW project. The platform enables you to save small sums on a monthly basis towards a housing project. It is an excellent solution and I encourage all to latch on to the opportunity. #FreedomIsComing