There are pros and cons to investing in property in Nigeria and Lagos. As a case study, it is important for you to weigh up the benefits and the risks before making a purchasing decision.
The more educated you are about increasing in property the lower your risk will be. This will direct you along a path so you will know exactly whether a property is for you or not.
PROS OF INVESTING IN PROPERTY
1. IT IS A STABLE INVESTMENT:
Research has proven that property investment when compared to other forms of investment has proven to be the most stable investment. Although it has its ups and downs however the property market tends to be a lot less volatile than other investments such as the stock market.
This may be due to the fact that property takes a long time to sell as well as the fact that property is almost always in demand (while investment in shares can be sold in split seconds).
As we all know in Nigeria and Lagos as a case study, population growth is outstripping supply and we can’t develop housing fast enough.
Property tends to appreciate every 7-10 years; a property worth #5,000,000 in some area of Lagos 10 years ago is now worth #30,000,000 and counting.
2. YOU CAN LEVERAGE YOUR INVESTMENT:
By leveraging on your investment, it helps to maximize your return on investment (ROI) when your property appreciates.
3. POSITIVE CASH FLOW WILL BE GENERATED FOR YOU:
One of the pros of owning an investment property is that you can rent it out.
You put down the deposit and the people renting the property pay for the mortgage and expenses. If you are smart enough you will even have some money left over which is a positive cash flow and passive income. Over time as you pay off your mortgage, you gain even more positive cash flow.
4. LONG-TERM RETURN ON INVESTMENT (POTENTIAL FREEDOM INCLUSIVE):
Many people love property as an investment because it can be a great long-term investment. By securing your land today you can reap the benefits of it in the future.
CONS OF INVESTING IN PROPERTY
Just as we have benefits of investing in property, we also have some disadvantages of investing in property. Cons associated with investing in property are:
1. IT IS NOT VERY LIQUID:
Shares can be sold at a moment's notice, property takes longer to sell. Depending on the area it could take weeks or even months to sell your property. This lack of liquidity can be a con if you need to access your money quickly for use in other areas of your life.
2. BAD TENANTS CAN BE A NIGHTMARE:
Bad tenants affect cash flow if they don’t pay their rent, properties are not always a sell and forget investment, sometimes it takes hard work and a little stress.
3. ADDITIONAL COST:
Properties carry additional costs like maintenance and renovations. This cost may be regular or may come as a surprise when you least expect it.
With proper planning and the right investment, you could land a property where the rental income outweighs all of these expenses and still put money into your pocket.
Yes, there are pros and cons to investing in property, but if you get it right it could lead to financial success and financial freedom.
You also have the power to manage your risks and take control of your investment portfolio, so you can actually swing it so the “pros are in your favor”.
Vines Realty is a leading real estate company and we are here to meet your real estate needs and questions.
Hope this brief and insightful article has been helpful to your questions.