Mr Noah Ibrahim is the Managing Director/Chief Executive Officer of Novarick Homes and Properties Limited. In this interview with DAYO AYEYEMI, the techpreneur speaks on the activities in the real estate sector, its potential, major challenges and ways out as well as his new scheme to help young people own property.
WHAT is your assessment of the real estate industry in Nigeria compared to other emerging economies?
The industry is still developing and growing, and we have a large population of over 200 million people with a large housing deficit. There is still a lot of potential for the Nigerian real estate sector.
The biggest challenge, however, is that people do not have a high purchasing power, and we have to depend on Public Private Partnerships (PPP). Compared to other sectors, we cannot really make a comparison because of our growth.
What do you consider as challenges militating against investment in the real estate sector?
The major challenges are documentation and access to finance. Getting the documents of your properties can be one hell of a challenge.
How can these challenges be solved?
They can be solved through the implementation of proper policies in terms of land ownership and more partnership for the private sector. There is a need to improve on the economic landscape of the country and make the country more secure. These will open up the sector for more investments to come in. There are also other things which can help the real estate sector; they are access to foreign exchange and materials. Once you don’t have a good economy, you’ll have a high level of inflation. The government should tackle the economic issues we have and improve the value of the naira. Most of these building materials are being imported because we only produce a few here and that makes the cost of materials so high. It affects the developers who are buying, which in turn has an effect on the cost of the property.
How can we grow the Nigerian economy through real estate?
There are different types of real estate. There’s commercial, residential, industrial, tourism and lifestyle. It is very straightforward; I would give you an example. Look at Tanzania, the country is making a lot from tourism. Tourism is a place of attraction which should include artefacts, leisure homes and beach houses. Good access to land, documentation and funding would help the real estate sector. Most banks do not give out funds. They will tell you they don’t have funds for real estate and then, you have to get some collateral you don’t have. Access to funding is very important for developers to build more affordable houses to live in. More public-private partnerships are also
We created this scheme to help many young people own property. The Nigerian economy is not stable at the moment and there are a lot of young people who would want to invest in real estate but cannot afford to buy them outright.
If you are to advise the government, what will be your suggestions?
Create access to funding for developers, provide lands for developers to build on, run a form of partnership with them and create more infrastructure projects. What is making Epe thrive today is the road network they enjoy and, I must say they have the best road network in Lagos state. The only major access to Ibeju-Lekki right now is the Lekki- Epe Expressway, and that’s the only road that leads to other areas along the road. If anything happens on that road, everyone would be stuck and nothing will be done. All economic activities in that area will be halted. Government should create more roads, alternative routes and extend roads. All of these things would help stabilise the industry and create more opportunities for us.
What really motivated you into the real estate investment and facility management sub-sector?
My biggest motivation is value addition. I have always spoken about value addition. I was looking for an avenue that would enable me to add value to people’s lives and still make wealth for myself. The real estate sector is one of the few industries where I can directly make an impact by helping people own properties. Fortunately, my guiding principle is that, if I can help as many people get what they want then I’ll easily get what I want.
For instance, a land of N750,000 would take over two years to complete payment, so we had to restructure our payment plans so that it fits well with this scheme.
The young investors have the opportunity to pay at their own pace with what they can afford. The aim of this scheme is to bring as many young people into property investment.
Why targeting under 30 for a real estate investment scheme?
Most people who have invested in real estate today made their investment many years back. So many properties in the highbrow areas were sold for a low price and as of now, the prices have increased. For instance, properties in Lekki in the 90s sold for below N5 million and right now, you have properties for N100 million to N160 million. If you do the calculations, you will find out you have a lot of returns on your investment. So we thought to ourselves that why not bring young people on board to invest in real estate. If we could create an opportunity for young people to invest in real estate it would really make a huge impact.
How does this scheme work?
We purchased some parcels of land in Ibeju-Lekki and Epe which were sold for below one million naira, and placed them in the market for young people to purchase. Based on what you can afford, we created a pocket-friendly payment structure and upon completion of the payment, you will be provided with your document. Before you complete the payment for the property, it would have already been appreciated beyond the initial payment. If you decide to keep the money in the bank, it would be devalued. So the best thing is to put the money in something that would appreciate over time.
How many people have benefited from Novarick under 30?
When we began we had about 80 investors and we can say we have eight landlords who are under 30. We found out that it’s a dream come true for someone below the age of 30 to own a property.
Do you have any estate development ongoing, where are the locations and how many units?
We have estate developments in Epe and Ibeju-Lekki. We have the Nova Gardens. Phase two will be launched soon and the Wazobi Court Ibeju-Lekki, which is about 30 acres of land. In each of the estates, we have about 800 plots available, we have positive investments and we are hoping to create more opportunities for people.
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