Lagos is Nigeria’s economic powerhouse. Such investments offer significant opportunities for passive income generation and, most importantly, wealth creation. Amongst such investments is real estate. Notwithstanding how powerful the economy of Lagos is, smart investors still ask questions before buying any duplex here. I’m sure you want to know what these questions are.
With all the variety of real estate investments, the purchase of duplexes stands out due to their appeal to high-income earners, given their luxury and the social stance it portrays of its owners. Nevertheless, making a duplex decision requires thorough considerations and careful audit, to avoid making a bad investment.
Following through this guide, you will be abreast with critical questions that you should ask in order to make a smart investment decision in Lagos. This will help you minimize risks and maximize returns.
You might be asking yourself: “Is it even important to ask questions when I have the needed funds to purchase a duplex?”
The answer is yes, and I will tell you why.
Why Is It Important for Smart Investors to Ask Questions Before Buying a Duplex in Lagos?
Quite a number of investors have fallen for the thrill of owning a duplex in Lagos because they don’t ask the right questions. As a result, they are now victims of real estate scams. These issues could have been avoided if the investors had patiently taken their time to reflect and truthfully answer these questions we will discuss.
7 Questions Smart Investors Ask Before Buying a Duplex In Lagos
1. What is the actual market value of the property?
Lagos’ real estate market may not be transparent with public data on true property valuation. You may fall for the thrill of being a Lagos homeowner, and be defrauded as regards the real price of the property.
As a smart investor, you should:
Research comparable properties
Search beyond the desired property into other properties in that location, and know the real price of properties therein. This will help you get insights into the realistic market value. Real estate sites like PropertyPro, Nigeria Property Centre, Jiji Property, etc., can give you more insight, apart from physical research.
Calculate potential rental yield
Duplex gross rental yields range between 5% to 10% in prime locations in Lagos.
Consider Running Costs
Duplexes often require high maintenance costs as compared to other properties. You will need to create a budget for:
- Generator maintenance
- Fuel purchase
- Water supply options
- Service charges
- Security provisions.
It is noteworthy that a property that has a lower yield but lower maintenance costs is better than one with a high yield but higher maintenance costs.
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- What to Expect in a ₦750 Million House in Osapa London, Lekki
2. What is the condition of the property?
Due to the influx of fraudulent developers in the real estate sector, most properties are constructed with substandard materials. This leads to wall cracks, leaking roofs, and damage to some parts by rain or wind. The worst is a building collapse. As a smart investor, you should:
Conduct an extensive inspection
Due to zero expertise, you may not be able to ascertain the real condition of the property. Therefore, we recommend you hire qualified building inspectors to assess the structural integrity, roof condition, drainage systems, electrical system and plumbing system.
Assess construction materials
Your duplex is a premium property, and as such, it should have high-quality imported finishes, robust security systems, a proper drainage system, and buffeted water proofs.
Evaluate flood mitigation measures
Buildings in areas that are prone to flood, like Ibeju-Lekki, Badagry, etc., should have elevated foundations, water pumping systems, and proper drainage.
Scrutinize age and renovation requirements
Duplexes that are less than 5 years old do not require immediate maintenance compared to older ones.
3. What is the value proposition of the location?
Areas like Victoria Island, Ikoyi, Banana Island, and Eko Atlantic are known for their high property values, upscale amenities, and proximity to business centers. As a smart investor, you should
Consider infrastructure development
Areas with completed, ongoing or planned infrastructure development projects frequently experience notable property appreciation.
Check its proximity to business districts
Take into consideration the travel time to business areas like Ikeja, Lagos Island, Lekki Free Trade Zone, etc. Properties that are relatively close to these business hubs experience robust appreciation.
4. What is the community outlook?
You would bet with me that even though you want to invest in a duplex in Lagos, not all communities are worth your investment. As a smart investor, you should:
Consider estate management quality
Most estates in Lagos have a poor management structure in place. Pay attention to the security arrangements, community upkeep, transparency in service charges, reliability of water supply, and most importantly, electricity/power systems.
Observe community demographics
You should have a vivid understanding of the residents of that locality. Are they expatriates, corporate or executive personnel, or even family or individual residents?
Reflect on environmental concerns
Give a thought to any environmental concerns like air pollution issues, noise pollution, industrial areas, and waste management systems.
Appraise future development plans
Examine any future development that may take place. It could be commercial developments, road expansion projects, public transportation improvements, industries or hospitals.
5. What is the legal status of the duplex?
The amount that you invested in purchasing a duplex can go to waste if there are complexities regarding its legality. As a smart investor, you should:
Scrutinize land titles
Do not fall for the deceit of counterfeit land titles. Verify the authenticity of all the documents presented to you. Having a legal adviser will save you the trouble.
Examine encumbrances
From the Lagos State Land Registry, conduct research to determine if there is any pending litigation on the property, outstanding mortgages or a government acquisition plan.
Check for building approval
Do your best to confirm if the property has building permits, and there is no violation of zoning laws.
Verify Omonile issues
To avoid any claims or disturbances from land grabbers, verify to know if all settlements have been made.
6. What is the economic outlook of the investment?
Real estate in Lagos always reacts to higher economic factors. As a smart investor, you should:
Evaluate economic diversification
Areas like Lekki Free Trade Zone, Ajah, etc., benefit from economic diversification may experience stronger growth.
Consider energy costs
The constant rise of petroleum products always impacts operating costs. Properties with solar or independent power supply always have long-term advantages.
Also Read:
- What is a Fully Detached Duplex in Lagos?
- Documents You Should Ask For Before Buying Any House in Lekki
- Read This Before You Buy an Off-Plan Property in Lagos
7. Are exit strategies available?
Before investing in any property, you ought to plan your exit before entering. As a smart investor, you should:
Reflect on the liquidity timeline
Prime duplexes in Lagos may take 3-12 months to sell at the actual market value.
Think about the alternative usage
Does the duplex have flexible designs to be converted into retreat centers, office spaces, co-living spaces, etc?
Calculate the rental-to-sale conversion
Based on previous data, calculate the potential appreciation rates if you want to put the property for sale later on.
Conclusion
With proper research and by asking these questions, investors wishing to purchase a duplex in Lagos can be guaranteed maximum returns.
Do you desire to buy this house in Lekki? Call or send a WhatsApp message to +2348134794494.