Real estate business is a profitable business that comes with a lot of challenges. And because the real estate market is a well-established one, those who are just entering into the business newly meet stiff competition from established real estate players. Apart the stiff competition, you’ll also meet collaboration among key players in this industry. But with utmost determination and focus, you can build a unique brand that will stand out amongst the rest.
Our goal in this article is to show you how to start a profitable real estate business in Nigeria that can stand the test of time. But before we proceed, let’s get a brief explanation of what real estate is.
What is Real Estate?
Real estate is a property consisting of landed properties, buildings or a huge collection of properties. Real estate business is the process of buying and selling or renting a property, building, home or land. The Real estate agents assist homeowners, businesses and investors buy and sell all form of properties.
The real estate business can be divided into further parts which include: loan servicing, residential, commercial properties and so on. Examples of residential real estate include developed land and undeveloped land, houses, condominiums, and town houses; examples of commercial real estate are office buildings, warehouses, and retail store buildings; and examples of industrial real estate include factories, mines, and farms.
Real estate business is so lucrative because Nigerians are always in need of residential apartments, office building, store and other commercial outlets. They look to either buy or rent buildings and structures of their choice, and they sometimes need to consult real estate agent or expert to assist them.
Steps to start a Real Estate Business in Nigeria
In order to be successful in a real estate industry, you need to have good knowledge and information concerning real estate. This knowledge and information is what we know how to dish out on this site.
Follow this information to start a successful real estate business in Nigeria:
Develop business plan
Developing a strategic business plan for your real estate business is an important step to take if you want to beat the stiff competition in this business. Real estate investing is just like starting any other business venture in which you can’t start on a whim without having a specific business plan or model in mind.
A business plan is vital for any real estate investor, and one of the best pieces of advice you’ll get in the housing market is to start small. And then, plan, plan, plan! This step is especially important if you’re planning on becoming a real estate investor for the long term. In this case, you want to grow your real estate investment portfolio strategically. Without a strategic business plan, you’re heading to failure in the long-run.
Build a unique brand
Brand building takes the central place when it comes to setting up a real estate business with a unique identity. And Brand credibility is important in building a successful business in Nigeria especially when it has to do with the investment that worth millions of Naira. Branding is all about creating a memorable perception about your business in the minds of people.
To turn your real estate business into a trustworthy brand, you need to give your customers more than enough value for their money and build a relationship by engaging with them on a personal level. Also, set your real estate business apart from the competition by investing in premium branding identities such as logo, website, blog, adverts and more.
Register your business legally
If you really want to get this business to the highest level, then you have to legalize its existence by registering the business with the Corporate Affairs Commission (CAC). Registering as a Business Name with CAC is enough at this stage if you can’t afford to register it as a Limited Liability Company (LLC). Also, watch out for the rules and regulations guiding professional real estate bodies in Nigeria to ensure that you are not operating against the law. Some of the popular real estate professional institutions to watch out for include; Association of Estate Agents in Nigeria (AEAN), Real Estate Developers Association of Nigeria (REDAN) and Nigerian Institution of Estate Surveyors and Valuers (NIESV).
Raise the required capital to start
If you did your business plan research well you must have known the minimum amount of money it will require to get you started depending on your entry level. If your savings and financial capacity are not enough to start, you can source for alternative funding. We’ve written on ways to source fund to start a business in Nigeria, you can check out that.
Real estate business is very capital intensive and requires a huge amount of investment. If you do not have enough capital it is important that you seek investors. You can look for equity investors that can give you enough leverage at the start and accelerate growth.
And let me mention it at this point, you can also start real estate business without capital by mortgaging the properties. Many big time real estate investors have made it through this means. Well, this topic: how to start real estate business without capital will be a topic of another day because, I’m ready to spell out things in details.
Get started and execute
The last step to starting a real estate holding company is execution. Execute everything that you’ve developed in your business plan. A good number of Nigerian businesses fail due to very poor execution. Execution comprises of your day to day activities in the business. This includes the opening and closing of deals, marketing, networking, client orientation, human resources etc.
Starting a real estate business isn’t for the faint mind. To be successful in the real estate business, you must be prepared to face the challenges at a personal level, and on a business level. You must a goal-oriented and organized person. Knowing that to achieve success in real estate sector doesn’t happen overnight rather it takes time. It is a long time game, which requires a lot of patience and sacrifice.