Thread 1/14
Today’s Rant:
Estate Agents and Real Estate Marketer are the problem.
Have you come across a property sale ad that states.
1bed - 85m
Annual revenue - 12m yearly
Follow the thread @housing_LASG @fmhud_ng
Today’s Rant:
Estate Agents and Real Estate Marketer are the problem.
Have you come across a property sale ad that states.
1bed - 85m
Annual revenue - 12m yearly
Follow the thread @housing_LASG @fmhud_ng
2/14
Cost of cement has stayed relatively stable in about 2 years but labour cost has gone up significantly, however, this doesn’t justify a 40%-50% jump in real estate value without additional value in 1 year.
Cost of cement has stayed relatively stable in about 2 years but labour cost has gone up significantly, however, this doesn’t justify a 40%-50% jump in real estate value without additional value in 1 year.
3/14
Here is the problem - rental value has often been calculated based on property amortization of 20 years.
Eg house value/20 to estimate yearly rental.
Meaning a house bought at 100m will rent for 100m/20yrs =5m that’s logic
Here is the problem - rental value has often been calculated based on property amortization of 20 years.
Eg house value/20 to estimate yearly rental.
Meaning a house bought at 100m will rent for 100m/20yrs =5m that’s logic
4/14
However, you see Agent and Marketers have walked from the answer to the question by creating pseudo estimates based off short let income.
This is the reason you see a house for sale at 85m carrying an annual income potential of 12m/year that’s 14% of purchase value yearly
However, you see Agent and Marketers have walked from the answer to the question by creating pseudo estimates based off short let income.
This is the reason you see a house for sale at 85m carrying an annual income potential of 12m/year that’s 14% of purchase value yearly
5/14
Most buyers today are not first time owners, but rather people who have amassed some wealth (definitely not paying rent) who want to invest and buy based on potentials advertised. Only to realize not all shortlets scale as advertised
Most buyers today are not first time owners, but rather people who have amassed some wealth (definitely not paying rent) who want to invest and buy based on potentials advertised. Only to realize not all shortlets scale as advertised
6/14
To them it is an investment with returns planned. So, when they realise the issues, they revert to annual rent but want near net return of Shortlet without the hassle. Hence the reason some will advertise house purchased at 85m for rent at +7m
To them it is an investment with returns planned. So, when they realise the issues, they revert to annual rent but want near net return of Shortlet without the hassle. Hence the reason some will advertise house purchased at 85m for rent at +7m
7/14
Potentially reverse engineering the house value to match rental value expected. reverse engineering rent to match 20 years of house value. That’s 7mx20 raising sale value to 140m for absolutely no reason or logical rationale.
Potentially reverse engineering the house value to match rental value expected. reverse engineering rent to match 20 years of house value. That’s 7mx20 raising sale value to 140m for absolutely no reason or logical rationale.
8/14
Now to the common upcoming middle class will always get knocked out of the potential property market.
The worst thing is, your government who should regulate absolutely cannot relate to the problem to land a solution.
Why? The pay no rent and live on tax payers bill
Now to the common upcoming middle class will always get knocked out of the potential property market.
The worst thing is, your government who should regulate absolutely cannot relate to the problem to land a solution.
Why? The pay no rent and live on tax payers bill
9/14
How do you tackle such problems?
Regulation on a state level.
Prices are typically controlled by the laws of demand and supply (but not real estate in Nigeria).
A.) Work on the supply end by instituting Shortlet regulations through licensing.
How do you tackle such problems?
Regulation on a state level.
Prices are typically controlled by the laws of demand and supply (but not real estate in Nigeria).
A.) Work on the supply end by instituting Shortlet regulations through licensing.
10/14
No license, no Shortlet operation. Flout it, ur property allocation will be revoke and your property auctioned by state
B.) Estimate property valuations per location in the state to regulate pseudo valuation (it is all perception and payment of perceived value driving it)
No license, no Shortlet operation. Flout it, ur property allocation will be revoke and your property auctioned by state
B.) Estimate property valuations per location in the state to regulate pseudo valuation (it is all perception and payment of perceived value driving it)
11/14
With estimated valuation rent will be set at value/20yrs
You flout it your property is repossessed by state government or finned, you don’t pay fine your property is auctioned.
C.) Limit old build (pre2023) rental value increase to max 5% annually.
With estimated valuation rent will be set at value/20yrs
You flout it your property is repossessed by state government or finned, you don’t pay fine your property is auctioned.
C.) Limit old build (pre2023) rental value increase to max 5% annually.
12/14
D.) Institute owner occupier rules. Only owner occupiers will be registered in lands for the next 4 years.
Your property is not registered, your property is repossessed and auctioned. People will begin to register their properties to make them mortgage worthy
D.) Institute owner occupier rules. Only owner occupiers will be registered in lands for the next 4 years.
Your property is not registered, your property is repossessed and auctioned. People will begin to register their properties to make them mortgage worthy
13/14
E.) Finally, properties left unoccupied for over a period of 3 years will be repossessed and auctioned
F.) Urban undeveloped land laying fallow for over 5 years will be repossessed and auctioned.
Break the residential property investment madness
E.) Finally, properties left unoccupied for over a period of 3 years will be repossessed and auctioned
F.) Urban undeveloped land laying fallow for over 5 years will be repossessed and auctioned.
Break the residential property investment madness
14/14
Divert all intending individual real estate investors to commercial properties - buy a suite in hotel, or invest in a high rise office complex etc like Dubai did decades ago.
Leave home properties to those who need homes
Divert all intending individual real estate investors to commercial properties - buy a suite in hotel, or invest in a high rise office complex etc like Dubai did decades ago.
Leave home properties to those who need homes
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