23 Sep Uncommon Ways to Make Money from Real Estate
Globally, real estate is acclaimed for being a low-risk, high-reward investment vehicle for a myriad of reasons. In Nigeria, many consider real estate investment a money spinner, with revenue generation and capital appreciation guaranteed.
We are familiar with the common ways of making money in the real estate industry. Stories of how people purchased a parcel of land years ago witnessed the value of their land skyrocket, or how rental income earned on an inherited asset makes up 50% of the owner’s annual earnings. But we are here to let you know that there are more ways to profitably invest in real estate and implementing some of these ideas could be your gold mine.
Vacant land Rental: plots of land can also be used for rental, some investors include landscaping, and transforming serviced plots into a rentable space or garden. Land without any structure can also be given out for rent to roadside vendors to operate for a fee, examples are barbecue, suya and even bole vendors. Using your space as a car park is also another available option, many bus and tricycle riders often pay to park their buses and tricycles overnight in a secured space. Farming is another option, it might not sound exciting. Still, it is actually profitable to lease or rent vacant land out for commercial farming activities, especially for crops that grow fast, creating profit in and out of season.
Real Estate Investment Trust (REIT): If you are familiar with investing in the stock market then you would easily understand this. REITs are an easy way to invest in real estate without owning any property, it involves investors pooling money together via a corporation that purchases and manages income properties such as malls and office buildings. REITs can be considered as a group real estate investment; it is currently trading in the Nigerian Exchange market (NGX), REITs can easily be liquidated just like dividend-paying stocks. The downside of this type of investment is that it often flows with the stock market, which means when stocks go down REITs are likely to do the same.
Flipping: This is another means of real estate investment that involves the purchase of property and reselling after a short period, usually within a year. Another method of flipping is often called the Fix Flip, this involves buying an undervalued property with the aim of revamping/ upgrading it, then reselling at a higher price. This type of investment often requires immediate capital. Most Flippers play on the market and buy when prices drop, hoping to sell back as soon as the prices are back up. The downside to flipping is that selling homes may not be as fast as anticipated, it is mostly done by speculators and old players in the real estate market
Short let rental: This is a substitute for traditional hotel accommodation, it involves renting a furnished space to guests for a short period, usually below two weeks. You do not need a new apartment to do this, a vacant BQ can work for this type of investment. We have categorized this type of investment into two, Property Rental for Residential & Commercial buildings
Sales of Building materials: This is not a direct investment in the real estate market but it is an indirect real estate investment that can leave you smiling to the bank. The first thing you want to consider in setting up a building material store is proximity to active construction sites. The second thing to consider is the current stage of the construction and building material they are likely to purchase from you. Construction workers sometimes pay for water, shovel rental and others while work.
Real Estate Investment is not a one-way drive, there are multiple entry points into the real estate market, with a creative and focused mindset, one is sure to make a profit. Although there are several risks involved like many other investment opportunities, but the reward is great. Finally, it is best to seek advice and carry out research before investing your money in a property. Another thing you want to do is ensure you buy properties with unencumbered title from an authorized individual or company with legal rights over the property. Alpha Mead Development company is one trusted real estate company to invest with, Alpha Mead is internationally certified to ISO: 90001, and offers properties in fast growing investment areas in Lagos State, places like Sangotedo, Abijo and many others. Invest in real estate today and secure tomorrow.