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The favourable and unfavourable factors of owning a rental property. This article sheds more light on what ordinarily should be a worthy venture.



When I was an undergraduate schooling in Lagos, my first overtures away from the school hostel opened my eyes to the profitability of residential rental properties. My landlord in the self-contained I stayed back then had three other properties which he usually visited. Those residential rental properties were more like his empire; his only source of livelihood and you sure could tell that it was a wise investment. Opulence was his personal bodyguard; wealth trailed him everywhere he went. You could tell the investments paid off. He spent his entire day including weekends inspecting his properties and collecting rent when due, not forgetting when he had to carry out repairs. This had being going on for sometime until someone laid a complaint on one of his properties that fell short of standard.

In fact, the land where his properties stood was a disputed land. Within days, the bulldozers were rolled out and his residential rental buildings which had being his source of livelihood for years came crashing to the ground. Only my hostel stood!

A week later, the man died of a heart attack.This left me with something of a dual view of owning a rental property.

Though residential rental properties when well managed could be a huge fortune for the investor, on the other hand there could be more costs than expected and there are other big risks involved too if you are not doing the right thing.

Firstly, it is advisable to have a full ground knowledge of what you are getting yourself into, then you can start think of reaping the dividends of what should naturally be a wise venture.

The Advantages

The pros of owning a rental property may be relatively few but they are definitely powerful. If all goes well as planned you will smile to the banks from proceeds of a residential rental property. Here are some of the advantages of owning a rental property particularly properties of a residential nature.

1. Income from Renters

The goldmine from owning a rental property is basically the direct stream of income that comes from the renters. That alone, when paid when due keeps body and soul together and should ordinarily make you a very wealthy person if it’s the right kind of apartment. For example, if you own a property which has, let’s say 12 mini flats with each flat up for #200,000 annually, it means when fully occupied there will be returns of #2.4 million yearly on the property. Though other expenses may accrue in the course the year, still it’s a good sit-back and get rich investment.

2. Income from Property Value Growth

In addition, another area you have to consider is the property value. Simply put, rental value has the tendency to rise at any given point in time depending on the market trend. This is obviously going to be a variable thing, as it depends heavily on the area where your rental property stands. In some areas, the value may rise significantly over the course of a few years, while in other areas it may remain flat. Ideally, this value growth holds pace with inflation at a minimum. If you happen to be in an above average area, you might find that you can beat inflation; on the other hand, a really stagnant area may not even keep with inflation.

3. Revamping and re-modelling

Another strong area you need to consider is that you can decide to change the outlook and feel of your property which will mean adding more value to it, thereby increasing your earnings.

Turning your property from ordinary to high class correspondingly shoots up the price of that property and should you choose to sell it in the future, you would be realizing a huge fortune from such transaction.

The Disadvantages

Though the disadvantages to owning a rental property is relatively small, the effects on the owner can be disastrous. Let’s take a look at some of the disadvantages.

1. Concentration of Assets

One drawback to investing in a rental property is that for most people, owning a rental property is a serious concentration of their assets. There have being situations in the past where people own rental properties from their life savings only to lose same property they invested their life, sweat and savings in to an inferno, government clampdown, flood, tsunami, earthquake, insurgency, civil unrest or war. Subsequently, if they are unable to stand the heat in the kitchen they might as well begin to knock at death’s door.

Hence, non concentration of assets may not be a wise investment strategy. However, the more wealth you have, the less this becomes a factor and the more that property ownership becomes a tool for diversification rather than something you’re concentrated in.

2. Bad tenants

Having bad tenants in your piece of property is a huge let down and can place you on a path of no return. Some tenants never pay rents asides the money they pay when moving into the property. These tenants’ preoccupation is to make trouble anytime their rent is due

Though, sometimes you’ll get a great tenant that pays their rent on time for years untold, but that’s just by the way, There will always be defaulters when it comes to the issue of rent, you can only pray not to have too many of them in your property.

You may still get returns on your investment while having to cope with the headache from 1 or 2 defaulters. However, it becomes a nightmare when your defaulters are more than the good tenants, that could really be a huge setback for you.  Again, some tenants won’t pay regularly, and others won’t just pay at all.

There are also cases of tenants whose duty is to cause damages to your property. You will be amazed at the level of annihilation some tenants leave behind on vacating a property. This is a serious drawback and you may be running at a loss if it becomes a constant feature of your residential rental property.

There’s also the risk of not having a tenant at all, which means that you’ll have periods where the property generates no rental income.

3. Taxes and Fees.

There are property taxes and fees that the owner incurs here and there which eats into their profit and God help you if you have to deal with the problems of having bad tenants alongside. That could be suicidal. You won’t only be running at a loss, you will be incurring debts and your mental health may just be at risk. The major constraint of taxes and fees is that, regardless of whether you have people in the house or not, you’ll still be facing the cost.

4. Active Involvement

You can’t own residential rental properties then cross your legs and sit back at home. There is a level of dedication and commitment that comes with it. There will always be complaints here and there from tenants, even the debtors among them will not stop troubling you. There will occasional repairs to make and services to render.

In fact, the major thing that will have a permanent stay in your thoughts for years to come as long as that residential rental property still stands is the property and the tenants therein whose lives’ affairs  invariably becomes yours too.

Albeit, you can do away with this barrage of problems by simply hiring a property management company or a facility manager like Brickwall Global Investment Ltd.

Visit: www.brickwallinvestgroup.org, Mail: [email protected], Call: 09098883545


FG Approves $200m Loan For Lagos For Its Infrastructural Projects


The federal government has approved a $200 million loan for Lagos State to enable the state finance its infrastructural projects.

The loan will be sourced through a World Bank unit, International Development Association, IDA.

Rising from the Federal Executive Council meeting at the Presidential Villa in Abuja on Wednesday, the minister of Information and Culture, Lai Mohammed, said the approval by FEC followed a memo from the Minister of Finance, Kemi Adeosun.

He said Ms. Adeosun had sought the approval to obtain the loan from the IDA, a window of the World Bank in support of the Lagos state Development Policy Operation, DPO.

Giving more details on the loan, Mr. Mohammed said, “It would allow the state government to complete some of its very ambitious projects, notably the 61 kilometer, 10 lane Lagos to Badagry expressway, which also includes the 27 kilometre light rail”.

He also said the loan would enable the state government to completely rehabilitate the inner roads in Apapa in addition to some other major works it is carrying out.

The minister of Works, Power and Housing, Raji Fashola, who is the immediate-past governor of Lagos State, also spoke at the briefing, saying the $200million approved by FEC on Wednesday was not actually a new loan.

“It is a segment of a programme of developmental initiatives. It was approved in 2010, a total sum of $600 million for Lagos State, to be disbursed in tranches of $200 million each year starting from 2011, 2012 and 2013,” he said.

Mr. Fashola said accessing the loan by Lagos State suffered delays after the first tranche of $200 was received, “as a result of partisan political differences in the last dispensation”.

Brickwall Global Investment Ltd, in its mission to carrying out its vision, ” Making Affordable Housing For All”, has in its business procure “Free From Encumbrances” acreages of land over 1000 acres along agbara badagry express way, Ajah-Epe axis, Ikorodu etc. to supplement for the structural development coming to these areas.

You can contact us 09098883545 for any property procurement and real estate business.


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The Real Estate Agents You Should Avoid


We have many real estate agents in Nigeria but few credible ones. Hunting for the right real estate agent to handle your real estate transactions especially when you are thinking of selling your house is always an uphill task.

One of the most daunting tasks when you are thinking about selling your house is finding the right real estate agent. In a country where unemployment rates is alarming, it is quite easy to fall into the hands of unscrupulous real estate agents who know less about the profession but quite knowledgeable in the act of swindling and manipulating.

Although, spotting a dodgy real estate agent is definitely not a walk in the park. Here are signs that should indicate that the agent you are dealing with has a hidden agenda.

1. Agents who Offer you an Immediate High Price for your Property

If an agent agrees with you on the price you are willing to give up your property regardless if the amount is ridiculously on the high side or it’s a give-away price without conducting any market analysis, it should arouse suspicion. Though its not a bad idea when an agent first asks for your opinion on the value of your home, it is still expedient he does his own home-work. The agent ought to compare the price you want it to be sold to what’s obtainable in the market and the price of other similar properties in that location. He has to be realistic with you and let you know your house’s worth even if its below your expectations.

2. Real Estate Agents Who are all Dazzle
Though there are real estate agents who are good at what they do and show high level of professionalism, it is sometimes a red herring when an agent talks smoothly and easily wins you over with his/her charm. Let other attributes serve as your yardstick of determining which agent you want to go into business with. Be on the look-out for the following factors:

• Does the agent pay attention to detail? Will they consistently follow through with potential sales leads and relay information back to you?
• Will the agent be available for open houses and buyer inquiries?
• How many sales has the agent managed to complete in the past few months? Compare this number to the amount of listings they have held, and whether or not these listings were in your area.
• Is the agent really a professional in the field or just a wannabe or a rookie.

3. Agents Who Avoid Feedback
No matter how good you think your property is, be aware that beauty only is in the eyes of the beholder; in reality no one has a perfect home/house. If you want to receive the best possible price for your house, you need to be open to suggestions and feedback from your agent. If the agent doesn’t provide you with any suggestions for improvement, this could mean that they will be willing to sell your home at a lower price in an ‘as is’ condition; more like a give-away price. They may also just prefer not to share bad news. Although selling your home at a lower price may be acceptable, an agent should tell you that if you make some adjustments and give your home a fresh coat of paint you could see a 3% higher rate of return on your sale. With a reputable estate agent, you should expect quality feedback about your property.
4. Agents Who Don’t Communicate
To get involved with the right kind of agent for your real estate transaction you must take factors like communication, experience, and ethics into consideration. A honest agent with a good heart means a honest communicator, and you are sure he will be looking out for your best interests. Such agent will lay everything bare for you and present to you the pros and cons of your options unlike other agents that will only tell you what you want to hear.

The aforementioned points should help you avoid tricky and cunning agents who are only after their own gains even if that gain is your loss.

At Brickwall Global Investment Ltd, We take your property business into all consideration so as to proffer the best profit solution.

visit: www.brickwallinvestgroup.org

mail: [email protected]


Lagos State Tenancy Law at a glance

The promulgation of the Lagos tenancy law of 2011 came as respite for tenants who had been suffering in the hands of shylock landlords who had become excessive and brutal in their demands.

The Law was set up to regulate rights and obligations under tenancy agreements and the relationship between the landlord and the tenant including the procedure for the recovery of premises and for connected purposes. This law which applies to all premises within Lagos State including business and residential premises however exempts residences owned by educational institutions for its staff and students, those provided for emergency shelter, residential premises in a care or hospice facility, in a public or private hospital or a mental health facility. Law courts have also be given jurisdiction to determine matters in respect of the tenancy of any premises let – a jurisdiction which shall not be ousted by the defendant or respondent setting up the title of any other party.

The parties’ agreement to resort to Court connected Alternative Dispute Resolution (ADR) or other faci1ities such as the Lagos Multi-Door Court House or to the Citizens Mediation Centre for amicable dispute resolution shall not however be construed as an ouster of Court’s jurisdiction, while proceedings shall be brought under this Law at the High Court where the rental value of the premises exceeds the jurisdiction of the Magistrate Court as provided by the Magistrates’ Courts Law. Subject to the provisions of this Law, a Court shall be bound by the practice and procedure in civil matters in the Magistrates’ Court or the High Court of Lagos State. A tenancy agreement shall for the purposes of this Law, be deemed to exist where premises are granted by the landlord to a person for value whether or not it is; express or implied, oral or written or partly oral or partly written or for a fixed period. Also, it shall be unlawful for a landlord or his agent to demand or receive from a sitting tenant, rent in excess of six months from a monthly tenant and one year from a yearly tenant in respect of any premises without prejudice to the nature of tenancy held at the commencement of the tenancy, a sitting tenant cannot offer or pay rent in excess of one year for a yearly tenant and six months for a monthly tenant in respect of any premises then a landlord or his agent cannot demand or receive from a new or would be tenant rent in excess of one year in respect of any premises.

Furthermore, it shall be unlawful for a new or would be tenant to offer or pay rent in excess of one year in respect of any premises, any person who receives or pays rent in excess of what is prescribed in this Section shall be guilty of an offence and shall be liable on conviction to a fine of One Hundred Thousand Naira or to three months imprisonment. All landlords are required by law to issue a rent payment receipt to their tenants upon payment of rent in respect of such payments. The receipt shall state the; date on which rent was received, names and addresses of the landlord and the tenant, description and location of premises in respect of which the rent is paid, among other things. Any landlord who errs contrary to the provisions of the law shall be liable on conviction to a fine of One Hundred Thousand Naira. The law offers tenant’s entitlement to quiet and peaceable enjoyment of the Premises. This includes; privacy, freedom from unreasonable disturbance, exclusive possession of the premises, subject to the landlord’s restricted right of inspection; and the use of common areas for reasonable and lawful purpose.

On the issue of eviction, where there is a breach or non-observance of any of the conditions or covenants in respect of the premises as stated in the tenancy law, the landlord shall subject the tenant to:
(a) a week’s notice for a tenant at will;
(b) one month’s notice for a monthly tenant;
(c) three months notice for a quarterly tenant;
(d) three months notice for a half-yearly tenant; and
(e) six months notice for a yearly tenant

In addition, a premises will be deemed to be abandoned where the tenancy has expired and the tenant has not occupied the premises since the tenancy expired and has not given up lawful possession of the premises.

These are the salient parts of the Lagos State Tenancy Law. Tenants are urged to know their rights but should not fall foul of the law either.

for more info visit: www.brickwallinvestgroup.org


Certificate of Occupancy: How to process it successfully


For any building structure you see, whether a bungalow, duplex, sky scraper or even the foundational stage of a building, the Certificate of Occupancy, popularly called the C of O is what signifies legally that you have interest on the land upon which that property is standing on.

It is a very important document in any land transaction and is issued by the Government to the buyer of the land. Certificate of Occupancy is what makes you a lawful interest holder in the land and it also describes the type of use the land can be put to; commercial, mixed development or residential.

For example, according to the Constitution of Nigeria and since 1978, all land in a state (especially the urban parts of the state) is to be held by the Governor in trust for the people of the state.

This is not to say that we still don’t have people who exercise rights of their own on landed properties. These are called “omo-oniles” in the popular palace. Usually, their holdings are outside the legal frame work and would have to be brought in when you buy or even by themselves before selling if it is to become bankable.

To buy land therefore, you can make your purchase from the “omo-oniles”, Government or some other entity (individual or corporate) who must have earlier bought from either “omo-onile”s or Government.

Therefore to purchase a land, you either buy directly from the government, from individuals who bought from the government or from these so called “omooniles.” In cases where the said land has being a matter of some form of acquisition, you may have to pay the two of them to have access to a land.

At Realty Point, we usually advise that a proper due diligence be done when buying a piece of land because ignorance is not an excuse in law. Whoever you buy from, it is important that you obtain your Certificate of Occupancy where none existed before so as to ensure you secure a perfect title to the land.

To obtain your C of O from the government, you need to

1. Apply for land information and get your land information certificate. To do this, you need to pay an application fee at the Surveyor General’s office and provide a chartable survey plan (2 cloth, 2 paper)

2. Purchase a C of O application form. If a residential building, it’s =N=5,000 but if commercial, it’s =N=20,000 in Lagos State.

3. Fill and submit the application form in Land Use Allocation Commission (LUAC) with the following supporting documents

o Land information certificate

o Receipt for land information fee

o Receipt for application form

o Publication/inspection fee of =N=10,000

o Capital contribution (to be calculated based on size and location of land)

o Land purchase receipt/agreement (duly stamped)

o Copy of current tax clearance certificate (individuals)

o Copy of =N=100 development levy receipt

o Site location sketch

o Four passport photographs of applicant with white background

o Copy of approved building plan (if developed)

o Copy of tenement rate receipt (if occupied) or Land Use Charge

o Cover letter addressed to executive secretary LUAC, stating all documents attached, as above and typed with applicant’s address

o Acknowledgement slip from LUAC

When this is done, a letter of confirmation is issued to the Applicant with a plot and block number and the Scheme Officer processes the application for the Certificate of Occupancy, signs off on the file and forwards the files to the Executive Secretary of LUAC.

This takes a period of five days. After this, the Surveyor General provides Scheme Officer with digitized survey which is processed for two days. The Executive Secretary LUAC approves processing and signs letter of allocation.

He signs off on the file and sends the file to the Senior Special Assistant to His Excellency on Lands. He or she then vets the entire file and sends it with a covering memo to the Permanent Secretary Lands Bureau.

However, if the file has a query, the message is relayed back by notification. This process takes two days also. When the Permanent Secretary is done, he signs off the memo and sends the file to His Excellency who approves and electronically signs the Certificate of Occupancy. these two processes takes a period of four days and should the file have a query, message is relayed back by notification.

Upon approval and signing of the Certificate of Occupancy by His Excellency, He signs off and sends it to the Deputy Registrar for further processing. The Deputy Registrar processes the file further, signs off and sends it to Registrar of Titles for final registration.

The Registrar of Titles then registers the Certificate of Occupancy, signs off and request for its printing. These processes take a total of five days. Altogether, the total process adds to a period of 21 days.

It is worthy of note that in these 21 days, the application is advertised to attract objection or no objections before it is processed.

Kind of tedious wouldn’t you say? That’s why Brickwall Global Investment Ltd is here to take the stress off you!

Acquisition of Land: Since 1978, the major legislation regulating the acquisition of land within the country has been the Land Use Act of 1978 which states that all land in a State is to be held in trust by the State Governor for the benefit of all Nigerians. By law, foreigners may also acquire land wherever it is located in the country from either the State governments or from other holders.

Consent: The issue of getting a property can sometimes be very daunting if you have to think about the stress and many processes involved. First, you have to be sure what you’re buying is genuine and will not be sold to anyone else after your payment except by you.

Deed: A deed, as defined in the dictionary is a signed document pertaining to the ownership or legal rights of landed property. Ownership, legal, rights, property, signed are some of the keywords that stand out here.

Land Titles: The Government of Lagos State headed by Gov. Babatunde Raji Fashola recently announced that land owners in Lagos who have no proper land title should make haste to regularise their title within 6months starting from August 1, 2012 or face the consequences of revocation.

Building Plan: I like to think of building plan thus: Every idea starts with the gift of imagination! However, it has been proven that even the shortest pencil is better than the longest memory. Imagination needs to be captured otherwise it becomes a thing of the past.


Lagos parleys with stakeholders to checkmate increasing housing demand

Stakeholders said that Lagos Government must adopt a multi approach strategy in order to checkmate the increasing housing demand in the state, hence the problem would continue escalate .

Many of the approaches to curb the increasing housing demand were thrown up at an event, in Lagos recently, which had in attendance, foremost private developers, government officials, mortgage bank operators and professionals in the built environment, among others.

According to the report from the Guardian, the forum was prompted by Government’s decision to provide 20,000 homes of different house types in the state between now and 2018.

Realising it would be a mere desire if stakeholders are not carried along, the Lagos State Commissioner for Housing, Mr. Gbolahan Lawal said government would ensure it creates enabling environment rather than going into actual construction. “It is not the business of government to build houses, but rather, to provide the necessary incentives that would attract the attention of private sector”.

After exhaustive deliberations, a communiqué was released wherein it was suggested that government should define its role in housing delivery, for example, whether is it for profit or ‘welfarist’ and within what boundary; ascertain credible records of demand/need and the shortfall in housing; provide comfort for developers in terms of infrastructure provision through future project discount on land and other such charges.

It was also demanded that government should ensure easy accessibility to titled land, ensure simplification/timely delivery planning approval; specification of the price bands, which would include the cost of land and facilitate means of lowering the cost systems building; assist in access to funds, including affordability gap fund; standardize housing delivery methods and facilitation of industrialization of housing.
Others include, facilitation of information exchange among the developers and revisiting legislation for regulation of housing provision through professionalism; do more on mortgage counseling; facilitate access to funding from capital market for construction finance and pooling of developers’ systems with a view to ensure standardization; proffer solution to preclude mortgage defaulter, including insurance and rent-to own as alternative to mortgages.

During discussion, it was agreed that the issue at hand required a multi-pronged approach, particularly, in Lagos, where its mega-city status is putting pressure on the existing accommodations.

Among issues discussed include how to establish correct data of those who need houses and who have funds to back up their need; issues of land administration; construction methods and building materials, and how they are hampering or improving housing provisions and delivery agents and model for housing delivery.

Others are available finance mechanisms, mortgage facilities, industry’s standard and regulations and government policies.

Former Chairman, Federal Housing Authority (FHA), Brigadier-General Tunde Reis, who moderated the event was of the view that to advance the course of housing delivery, developers, as the key driver, mortgage operators, policy makers, professionals in the built environment must come together and painstakingly look at the best approach to meet housing deficits in the country.

According to Reis, no industry can grow on guessing, therefore, there is need to know the actual number of shortfall in housing needs, the potential buyers, available land, preferred location of the would-be home owners, availability of mortgage facilities, amongst others.

“People have been brandishing 17 million housing deficit in Nigeria for close to a decade when I was chairman of FHA. But the question is where is the data? Does it mean that no homes have been delivered to bridge the gap since then? This shows that we are just speculating and with that, we cannot get anywhere. Reiss said.


How You Might Consider Purchasing Your Real Estate Investment Properties


There are several ways to buy your first real estate investment. If you are purchasing a property, you can use debt by taking a mortgage out against a property. The use of leverage is what attracts many real estate investors because it lets you acquire properties you otherwise could not afford, but it can be dangerous because in a falling market, the interest expense and regular payments can drive you into bankruptcy if you aren’t careful.

You will almost NEVER purchase a real estate investment in your own name. Instead, for risk management reasons, you will want to consider holding real estate investments through special types of legal entities known as limited liability companies or limited partnerships (you should consult with a qualified attorney for his or her opinion as to which ownership method is best for you and your circumstances). That way, if the real estate investment goes bust or someone slips and falls, resulting in a lawsuit, you can protect your personal assets because the worst that can happen in some circumstances is you lose the money you’ve invested. This lets you sleep at night because unless you’ve screwed up somewhere, your assets, investment, and other retirement accounts should be out-of-reach.

Property Investment company like Brickwall Global Investment Ltd, can manage your property investment portfolio to any limit.


The 4 Ways Real Estate Investors Make Money

When you invest in real estate, there are several ways you can make money:

Real Estate Appreciation: This is when the property becomes more valuable due to a change in the real estate market, these changes can be subject to environment, weather, economy up or downturn, structural development, government policy, the land around your property becoming scarcer or busier such as a major shopping center going in next street, or upgrades you put into your real estate investment to make it more attractive to potential buyers or renters. Real estate appreciation is a tricky game and is riskier than investing for cash flow income.
Cash Flow Income: This type of real estate investment focuses on buying a real estate property, such as an apartment building, and operating it so you collect a stream of cash from rent, which is the money a tenant pays you to use your property for a specific amount of time. Cash flow income can be generated from well-run storage units, car washes, car parks, apartment buildings, office buildings, rental houses, and more.

Real Estate Related Income: This is income generated by “specialists” in the real estate industry such as real estate brokers, who make money through commissions from buying and selling property, or real estate management companies who get to keep a percentage of rents in exchange for running the day-to-day operations of a property. For example, a hotel management company gets to keep 5% of a hotel’s sales for taking care of the day-to-day operations such as hiring maids, running the front desk, mowing the lawn, and washing the towels.

Ancillary Real Estate Investment Income: For some real estate investments, this can be a huge source of profit. Ancillary real estate investment income includes things like vending machines in office buildings or laundry facilities in low-rent apartments. In effect, they serve as mini-businesses within a bigger real estate investment, letting you make money from a semi-captive collection of customers.