10 STEPS TO BUYING PROPERTY IN LAGOS
LEGAL GUIDE TO BUYING PROPERTY IN LAGOS
Buying land or developed property is one of the dreams of every Nigerian. It can be a very exciting and very scary prospect at the same time. This is especially so because in Lagos, Nigeria there is always the risk of fraud. Therefore, this guide is meant to explain the process everyone who is interested in buying property in Lagos should follow in order to ensure that it is done safely and properly.
STEP 1 – DECIDE ON A BUDGET AND LOCATION
Buying a property is a big step involving a substantial long-term financial commitment, so think hard about what you can afford. Also, if you intend to live in the property, then you need to be sure that it is in a location you are happy at and can be for a very long time. Once you decide on a budget and location, then you are good to go and you can move on to the next step.
STEP 2 – HIRE A COMPETENT LAWYER
Not all lawyers are experts in property transactions. It is not enough that you hire a lawyer, yes all lawyers have some idea about property law, but there are some nuances and issues which someone who is not a specialist in property matters would easily miss. Therefore it is critical that the lawyer you hire can prove to you that they know what they are doing. You will need a lawyer in all the next stages, so it is important that you hire the right lawyer. Let you decision to hire a lawyer be based not on convenience or price, but on competence and experience.
STEP 3 – LOOK FOR THE PERFECT (OR ALMOST PERFECT) PROPERTY
Once you hire a lawyer, the next step is to begin the search for properties which match your budget and location. At this point, you can engage the services of an estate agent, the estate agent will look for properties which match your criteria, create a shortlist for you, and then organise for you to view the properties shortlisted. Your lawyer can also assist you in recommending a trustworthy estate agent, if your lawyer is involved in many land transactions, he/she should have several estate agents they work with and can recommend to you.
STEP 4 – INVESTIGATING THE SELLER
When you find a property you are interested in, you should always ensure that the person you are dealing with is the owner of the property or someone who has the valid authority to sell the property. A lot of times when dealing with property in Lagos, you hear of fraudulent individuals who try to sell property which they do not own to unsuspecting buyers. This stage is where your lawyer begins his/her work fully, the lawyer will conduct the proper searches, ask the right questions, and request for the right documentation to determine if the person you are speaking to about the property in Lagos, is the real owner. This is EXTREMELY important especially when the property in question is family land.
STEP 5 – INVESTIGATING THE PROPERTY
If you pass step 4 and you can confirm that the person you are speaking to regarding the property in Lagos which you want to buy, is the real owner of the property or has the authority of the owner, then you can move on to this stage. In this stage, your lawyer will also play a big role. The lawyer will conduct the relevant searches and examine the appropriate documentation to ensure that the property is free from any encumbrance or pending litigation, that the property is not the subject of any Government acquisition, and that the property is not subject to any overriding interests
STEP 6 – VIEW THE PROPERTY
At this stage, if you have confirmed that the person you are dealing with has title, and the property is free from any issues, then you should visit the land to physically inspect it. At this stage you want to ensure that the land and the environment meet your expectations. It is also advisable to conduct a site visitation with a registered surveyor who will look at the survey plans and advise on the property as well.
STEP 7 – NEGOTIATION
This stage is self explanatory, here both the buyer and the seller have satisfied themselves that the deal can proceed, it is now a matter of agreeing on an acceptable price for the land. Your lawyer will be very instrumental here as well, as the lawyer will also be able to give you a solid indication of what future liabilities will exist for you (stamp duty fees, other government fees), so you can factor that in when making an offer. It is also a good idea to have an independent valuation of the property carried out in order to have a guide regarding the value of the property and whether the amount being negotiated represents fair market value of the property.
STEP 8 – DOCUMENTATION
If the negotiation goes well and the offer is accepted, then your lawyer (and the seller’s lawyer) can move to the stage of drafting and negotiating all the completion documents. In land transactions in Lagos, there are 3 main documents – the contract of sale, the receipt, and the Deed of Assignment. The lawyers will deal with this, and ensure that the interests of both parties are addressed.
STEP 9 – COMPLETION, EXCHANGE & POSSESSION
At this stage, the land transfer process is gathering pace, the buyer and the seller have signed and exchanged contracts, and the buyer is now in possession of all the original title documents and transfer documents. The purchase price of the property has also been made at this stage. Once all that is complete, the buyer becomes the owner of the property and can take possession
STEP 10 – POST-COMPLETION
Once the buyer has taken physical possession of the property, the next step is to file all the necessary documentation with the appropriate government authority and then commence the process to obtain Governor’s consent of the transaction. Once Governor’s consent is obtained a Certificate of Occupancy is issued, and the property transaction is then complete.
Please note that by virtue of the provisions of the Land Use Act, ownership of all property in a State vests in the Governor, and a right of occupancy is given to a person for a maximum of 99 years.