Rullion's Blog

On one of the most exclusive streets in Nigeria's capital sits a crumbling mansion with an unwelcoming message painted at its entrance: "BEWARE! THIS HOUSE IS NOT FOR SALE". The warning refers to a popular property scam. In the most elaborate version, robbers break into your house while you are away, change the locks, and then produce multiple copies of fake title deeds. Posing as estate agents, they show buyers around your house and sell as many copies of the deeds as possible. When you get back, your house belongs to six people. This sort of deception epitomizes the tricky nature of Nigeria's real estate  business , but despite the risks, there are huge returns to be had in a market where around 16 million homes are needed just to meet current demand. Navigating through opaque land laws, corruption, a lack of development expertise and financing, a dearth of mortgages and high building costs will take courage and influential local partners. "There are ...

From the stroke of midnight on January 1st, 2014, Nigerians should be able to access more affordable mortgages according to Dr. Ngozi Okonjo-Iweala, the Minister of Finance and the Coordinating Minister of the Economy. The Minister’s New Year present to Nigerians is based on the expected launch of an Institution known as Mortgage Refinancing Company (MRC) next month.  The primary aim of MRC is to support mortgage originators such as the Mortgage Banks and the regular banks to increase mortgage lending by refinancing their mortgage loan portfolios.

I met Dayo in my second year in Unilag, he was studying Biology while I studied Mass Communication. Dayo was a legend in school. He smashed all his exams without stress. We became friends when he was running for the President of the Student Union. Five years later, we are still good buddies. Dayo was a detailed fellow and a good judge of character, so when he told me something or someone was  sure,  I naturally believed him. After school Dayo became a well-known estate agent, so when I needed a place to stay, I informed Dayo, who informed me his uncle had an empty apartment in Lekki, which was close to my new office and was also affordable. I paid for the apartment without going to inspect it. That was how much I trusted Dayo. Two weeks after, I paid for the apartment; I was ready to move in when Dayo called to inform me that his uncle had rent out the apartment to someone else. I was shocked, where was my money? It was with his uncle. When will I get my money back? H...

The foundational principle of real estate investment is that it is an appreciating asset. The common belief is that real estate value always goes up. This is true, but it is not the whole truth. Like all other investment vehicles, real estate has its potential downside. It can actually diminish in value, plateau in value or lose value outright. Although this is not a common trend, an astute investor will look at the pros and cons of every investment he or she is involved in. Looking at it another way, a piece of real estate could be compared to a piece of cloth that you bought at an expensive price but which is no longer in fashion. By virtue of the shifting trends in fashion, it is still a piece of clothing but not actually the same in value. The various properties in the market are not the same in value and their location coupled with other factors will definitely determine their long term value to an investor. It is also easy to spot the manifestation of an area that has de...

Marriott International Inc. (MAR), Starwood Hotels & Resorts Worldwide Inc. (HOT) and Hilton Worldwide Inc. are turning to Africa, where a growing middle class and rising travel are fueling the fastest pace of hotel development in the world. Marriott has increased the number of hotel rooms it plans on the continent by 55 percent from last year. For Starwood, revenue per available room in Africa and the Middle East is the highest of any region worldwide. The high-end Transcorp Hilton Abuja, in Nigeria’s capital, commands some of the steepest management fees in the world for its operator, according to Lagos, Nigeria-based hotel-consulting firm W Hospitality Group. Hotel investors and operators, finding growth slowing in mature European and U.S. markets, are expanding in Africa as the continent is buoyed by increasing trade with countries including China and rising demand for services such as lodging. More than half of Africa’s countries probably will post gross domestic product ...

To rise in the company all I have to do is do my job well. The boss will surely notice me and reward my diligence. Nope. Not just for that. And this is what your parent’s generation is unlikely to tell you. (Unless you are one of the lucky few) Think of it as Maslow’s hierarchy of deliverables.  Step One At the bottom of the pyramid lies the Hygiene factor. This is the set of tasks that are essential and form the core of the job. The expectation here is that you do what is asked of you. The tasks are basic and mechanical. The employee is expected to work for speed and accuracy where the parameters of the task are already fixed. This is the part of the job that is likely to be mechanised or robotised in the interest of greater economy or accuracy. Examples of these include jobs of a typist or a fax operator. While both those tasks are still  part of the daily routine of most businesses, it employs fewer people each year solely for these. Every role, all the way up the...

Guys, I just ran into this story and thought the reasoning behind this decision was worth pondering on. Read on please: A major exam board has become the first in Britain to outsource marking to India as part of a cost-cutting project aimed at speeding up the assessment process. City & Guilds has been sending off thousands of papers to be marked by an education firm based in Bangalore as part of a pilot scheme. It had started outsourcing marking to MeritTrac as part of the scheme launched 18 months ago. "We have been undertaking a comprehensive pilot to meet market demand for a 20-day turnaround for marking on-demand exams. We have made a substantial investment in a more flexible way of marking, which we are piloting for tests with clearly defined marking schemes for right and wrong answers. This pilot accounts for 2.8 per cent of exams marked in the past year," the board said in a statement. "Highly-experienced, subject-matter experts continuous...

Deeds are legal documents that transfer the ownership of an asset (such as property) from one person to another; however, there are different types of property deeds for slightly different purposes. These are the most common types of property deeds: Warranty Deed Often used for residential real estate sales, a Warranty Deed acts as a guarantee to the buyer that the seller has the right to sell the property, and that the property is free of debt or other liens. The seller must defend the title against any and all other claims, and compensate the buyer for any unsettled debts or problems. Special Warranty Deed Differing from a Warranty Deed, the seller's guarantee does not cover the property's entire history.  Generally, the seller only guarantees against problems or claims created during the seller's ownership of the property. A Special Warranty Deed is often used in commercial property transactions or residential real estate sales. Quit Claim Deed Most of...

The Federal Government has announced that it will use $1.1 Billion borrowed from the Chinese Export Import Bank to finance the construction of 11 international airport terminals across the country; build a light rail line for its capital city, Abuja, and improve local communication systems. The minister of aviation, Stella Oduah, announced that the $550 million being earmarked for airports will be used to construct six commercial and five cargo terminals over the next two years. Abuja, Enugu, Kano and Port Harcourt and Lagos are set to benefit from the loan.  The light rail project, expected to cost $500 million, will transport commuters from Abuja's suburbs and neighbouring Nasarawa state to the city's international airport, while another $100 million will be used to improve Nigeria's internet capability.  Can you read in between the lines? The Chinese are penetrating Africa real good.

The buzz around is that after politicians, builders are the most despised lot. Everyone has a story of someone who got a raw deal. The keys were handed over three years after the promised date; buyers had to cough up more midway, thanks to a clause that initially appeared insignificant; the redeveloped apartment had two-and-a-half bedrooms instead of three; and a year later, another 10-storied tower sprung up on the "open space", blocking the view or the sea — for which the owner, taken in by pictures on glossy brochures, had paid a premium. The list is endless.  Some angry buyers move to court while others grudgingly accept what they get. A few years down the line, they stop cribbing as properties in the neighbourhood change hands for double the price they had paid. By then, they could be browsing another brochure that has found its way into the inbox, planning a second home that comes across as the only sensible, even if a little sticky, investment.  The housing ma...

In 1990, estimates indicated that 82 million hectares out of Nigeria's total land area of about 91 million hectares were arable. However, only about 34 million hectares (or 42 percent of the cultivable area) were being cultivated at the time. Much of this land was farmed under bush fallow, a technique whereby an area much larger than that under cultivation is left idle for varying periods to allow natural regeneration of soil fertility. Another 18 million hectares were classified as permanent pasture, but much of this land had the potential to support crops. About 20 million hectares were covered by forests and woodlands. Most of this land also had agricultural potential. The country's remaining 19 million hectares were covered by buildings or roads, or were considered wasteland. Nigeria's soil is rated from low to medium in productivity. However, the Food and Agriculture Organization of the United Nations (FAO) concluded that most of the country's soil would have ...

The National Council on Privatisation (NCP) has approved the commercialisation of the Federal Housing Authority (FHA). Consequently, the Minister of Lands, Housing and Urban Development had been appointed to chair the steering committee constituted to work out details of the exercise. This was one of the fallouts of a recent meeting of the Council, which was held in Abuja. The NCP said the decision was taken to address the huge housing deficit in the country. The FHA is a parastatal under the supervision of the Federal Ministry of Lands, Housing and Urban Development, established in 1973 and vested with the responsibility of preparation and execution of a National Housing Programme as may be approved by the Federal Government from time to time. FHA has a wholly-owned subsidiary, FHA Homes and Savings Limited, which serves as its Primary Mortgage Institution (PMI) with the mandate to maintain savings and mortgage loan accounts of customers. However, the noble objective of t...

Today, we but pause for a bit to discuss something a little different from our usual real estate and allied topics - TIER ONE CAPITAL . My good friend of about 10 years called my cell this morning to pick my brains on the basic difference between Tier One and Tier Two Capital owing to the fact that he knows that I wear another hat with roots in the Financial Services Industry. Within 3 minutes of talk he understood clearly what they are but I’m moved to sharing our conversation with our teeming bloggers (you never who’s going to learn something new). Here we go - TIER ONE CAPITAL This is one of the two categories into which a bank's capital is divided, consisting of the most central and important types of capital. According to banking rules, banks must keep a certain amount of tier one capital to protect them against failing. Tier one capital is the best form of bank capital - the money that the bank has in its coffers to support all the risks it takes: lending, trading ...

Sales price Rental per annum Lekki Phase 1  3 Bedroom flat N45m – N50m N2.5m – N3m 4 Bedroom wing of duplex  N70m – N80m   N3m – N4m Agungi 4 Bedroom detached house N45m – N50m N2.5m 3 Bedroom flat N40m      N1.5m – N1.8m Chevy view 4 Bedroom terrace house N42m N2.5m 3 Bedroom flats  N35m        N1.6m Crown Estate 4 Bedroom detached house  N30m – N40m  N1.5m – N2m Thomas Estate, Ajah 3 Bedroom flat N25m   N750k – N800k Abraham Adesanya 3 Bedroom bungalow  N12m – N14m N700k – N1m 2 Bedroom bungalow N11m – N12m  ...