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  You are hardly what anyone would describe as “wealthy” or “financially comfortable”. Yet you dream of owning a slew of property. You envision assets diverse and valuable, always expanding, in your possession. In the dead of night, you ponder how to build a real estate portfolio—even though you earn relatively little. Is this a habit you should give up, a pipe dream only fit for the bin?
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We say: let your imagination roam! And, more than that, begin planning for its actualization. The objects of your thoughts aren’t for pointless idling. They are within your reach! Even if you’re on a low income, you can start your journey to holding a fortune in real estate assets. It does take a good deal of discipline and strategy, but it’s doable. We’ll show you how, in a few steps laid out below:

Step 1: Find Out What Cheap Assets are Available

First, find out what kinds of assets you could afford if you were able to save a fair bit in a couple of years. Besides affordability, you’ll also be considering accessibility, development potential and prospects. We advise that you seek out the land (specifically land) away from the larger cities and districts, focusing on the outskirts of urban areas—places where land prices are relatively cheap but could rise significantly in the future. This should be a continuous search. Do this while you commence with step 2 below.

Step 2: Lay Out Your Cards

Next, take stock of the resources available to you. How much do you have in savings? If you don’t have much saved up yet, that’s alright. You can begin by setting something aside periodically, perhaps a percentage of your monthly income. You aim to have something in the neighbourhood of the value of the inexpensive lands you found in step 1. The speed with which you’re able to get to this savings goal will depend on what you can gather each month (or whatever interval you keep to). But don’t let this discourage you. If you are consistent, you will reach your savings goal in good time.

Step 3: Alternatively, Secure External Funding

Still, wondering how to build a real estate portfolio on a low income? Another path to building a real estate portfolio would be to solicit funds from family and friends. The intention here would be to buy a piece of land and flip it for profit in a matter of months. You may then return the borrowed funds plus a bit of margin, and keep the rest. If you get people to commit funds to your effort in this manner, and do so a few times, you should eventually make enough profit to buy and wholly own a plot for yourself.
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Step 4: Buy Your First Piece of Land

There are locations in which a plot of land is priced at under ₦500,000. If they are located close enough to the path of expanding cities, their prices increase quickly. The good news is that Nigeria isn’t running out of such locations anytime soon. As long as the country’s urban areas continue to grow, there will be districts adjoining them which will be home to the next best real estate investment. You might also want to check out states with a high population density. Inexpensive land is gold in those places, and finding them could make you a lot of money in value appreciation just a couple of years down the line.

Step 5: Sell, then Buy More

Land that’s situated nicely will see its value shoot up a great deal in two or three years. Some locations will even yield 100% return in 24 months. When the value of your land has climbed a considerable margin, you might consider selling it for a healthy profit. Then, use the proceeds (initial investment plus profit) to buy multiple plots (at least 2 plots) at a price similar to what your first piece of land originally cost. Of course, you need to purchase land in a promising district, like you did with the first one.

Step 6: Repeat Step 5 Continuously

The speed with which you’re able to turn over land for good profit will depend on the quality of the location you’ve invested in. Pick your spots well, and you’ll have a large portfolio of valuable land in a matter of 7-10 years.

Step 7: Diversify

At some point, you will begin to make enough from selling land to afford asset diversification. You could build residential spaces for rent, shops to let, and even office blocks to be used by paying businesses. This lets you receive income more regularly, and from an assortment of sources too.
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Final Words

We have shown you how to build a real estate portfolio on a low income. It’s not the easiest thing in the world, but it can be done. We know this because a good number of people have succeeded at it. So, starting today, take the step from dreaming about being a property owner to actually making it happen. We’re rooting for you.
Featured Image Source: Robert Irvin Burns
Got a suggestion? Contact us: editor@connectnigeria.com

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This article was first published on 29th September 2024 and updated on October 2nd, 2024 at 2:22 pm

ikenna-nwachukwu

Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.


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