Have you noticed something?
That during an economic crisis, we tend to be more conservative in our spending habit and shift more attention towards investing.
Sometimes, we even go as far as considering those offers we almost ignored before the downturn. Not because we are greedy people, but our priorities change during this period, from luxury to necessity.
Also, we become more money-conscious that we invest our funds against inflation and currency fluctuation.
But in our bid to invest, we sometimes end up losing money in risky investment schemes.
Don’t get me wrong.
I am not here to discredit any platform.
After all, there is always a level of risk in every investment opportunity, including Real estate.
However, these risks will not stop investors but mitigating those risks pushes them to understand the investment broadly.
For instance, a downside to investing in real estate is the slow process to convert into immediate cash.
So how can we control this risk?
One of the best ways is by being innovative. They say necessity is the mother of innovation, and that’s true.
For instance, when Nigeria’s economy slipped into a recession in 2016, real estate developers and landowners had to innovate a different investment arrangement that involved building without buying the land.
Since it became too expensive and time-consuming to buy land (especially in prime locations like Lekki, Ikeja, Ikoyi and Victoria Island), process the title, raise funds from investors and develop, they had to come up with an innovative way to build.
Simple, they went into Joint Ventures.
Owners observed that developers were on the ground, but the same developers looked for ways to reduce cost and deliver their projects in record time.
So we saw more Joint Venture deals in the market, where the landowner contributes land while the developer brings in the money, and everyone wins at the end of the day.
That’s just one of several ways to mitigate risks in landed property investment.
Another option property owners used to earn more money from vacant properties that year was to furnish those apartments and short-let them or redesign their larger homes into smaller apartments.
So you see, even when the economy is in crisis, there will be innovative real estate opportunities (though with a level of risks attached) lurking around you, but a good understanding of the market will help a lot.
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PS: Should you be open to investing in the Lagos Real Estate Market and you need data, please shoot my email at firstname.lastname@example.org