• 8 things to note before buying property

    8 things to note before buying property - nigeria newspapers online
    • 6Minutes – Read
    • 1095Words (Approximately)

    The joy and prestige of owning a property is dashed when it is lost to an infraction, improper documentation or bought from dishonest or fraudulent vendors. The property in this instance refers to land and landed properties.

    An individual becomes the true owner of a property when the conditions are fulfilled, especially the transfer of the title document, including certificate of occupancy, deed of sublease, Governor’s consent, etc., on the property to the individual.

    But many have lost expensive properties to demolitions, seizure based on court orders and fraudsters for not paying due diligence or getting appropriate advice.

    The Managing Partner of The Law Suite, Prince Nwafuru, said property transactions in Nigeria, particularly in a land-starved city like Lagos, often comes with a lot of risks which buyers must be aware of and take seriously to avoid falling into a booby-trap.

    The recent demolition and land revocation by the government in some states and the Federal Capital Territory call for caution on the part of prospective property buyers.

    Last month, the Lagos State government demolished over 20 modern and state-of-the-art buildings around the Lekki Phase II and Ikota GRA. The structures were built on drainage channels and extensions.

    In the FCT, a multimillion naira duplex was demolished for infractions in August, amid several warnings of revoking land allocations and demolition of unapproved buildings.

    Although these events could create worry in the minds of prospective property buyers, knowing the legal and appropriate steps to take should wipe off the worry lines.

    Here are some salient things to note when buying a land or developed property:

    A litigation and dispute resolution attorney, Wale Adeagbo, urged prospective property buyers to go through the necessary procedure, rather than cutting corners. He noted that property buyers must know whether the “person one wants to buy the property from has the right to transfer the property to another person.” Adeagbo stated that this information would help to avoid buying properties from unauthorised persons or companies, which could lead to future disagreements or even litigation. “The first thing to note is whether the person you are buying the property from has the right to transfer the title of the land,” he added.

    Nwafuru advised property buyers and sellers to engage lawyers before making any commitment. He added, “Most buyers only come to lawyers after their fingers have been burnt. Before negotiating the transaction, have your lawyer by your side. You also need to work with other professionals such as surveyors and registered estate surveyors.” Similarly, Adeagbo advised individuals who don’t seek legal advice and representation due to the fees to refrain from such because when avoidable problems arise, such persons would spend much more than they ought to.

    Property acquisition is capital intensive, likewise the transaction. It is therefore important that due diligence is conducted to guarantee the genuineness of the title before funds are committed. “Do a search at the land registry to be sure the property is not under any mortgage or long-term encumbrance and whether or not it is earmarked by the government for present or future purposes,” Nwafuru said.

    Adeagbo added, “Make sure that in whatever you are doing, you involve at least two witnesses. The witnesses must not necessarily mean your lawyer but those who could confirm that you went to a particular place at a time. Some people, especially those based abroad, trust real estate agents so much and would request video evidence of the properties and pay the money without any witnesses. This is not saying that real estate agents are not to be trusted but in case something happens, the witness helps to provide cogent evidence to support your claim.”

    Nwafuru advised buyers to have a plan and budget to avoid making impulsive decisions that could sometimes lead to “buying a property that does not fit into your budget. This sometimes leads to default in making or completing payment.” He also noted that to avoid disputes over boundaries and the actual location of land, prospective buyers must ensure that the desired property has an appropriate survey plan.

    “Most buildings have been demolished in recent times for not obtaining building plans from the appropriate authorities. As a buyer of a property from a developer, you have to demand and verify all permits and approvals from the seller,” Nwafuru advised.

    On his part, Adeagbo said, “Ensure that your lawyer is involved in the drafting of the agreement or whatever document. After that, make sure the deed is registered and get the governor’s consent. Also, whatever structure you want to erect, make sure you get the approval of the building plan.”

    Building collapse has been a recurrent issue in Nigeria. This therefore becomes a risk in property transactions, especially when buying a developed property. Nwafuru advised, “Before purchasing a developed property, it is important that you extract assurances and warranty from the seller that quality materials were used. It may also be wise to have your engineer run an integrity test on the structure.”

    Also, it is wise to use quality materials when building or remodelling a house. Doing this will ensure the safety of the builders and the occupants when the building is completed. It also eliminates the risk of collapse or demolition by the government.

    There have been instances where some property deals are attractive but could end up being a loss waiting to be incurred. Nwafuru stated, “This could mean assets that are in dispute or involved in litigation. It can also be assets that are used as a money laundering vehicle. Some other times, it could be an asset that is subject to government acquisition. Working with lawyers and professionals in property transactions and carrying out proper diligence and title verification would reveal a risky asset.”

    Adeagbo also cautioned prospective buyers to refrain from sales with unclear and strange terms and conditions. He said, “Don’t buy a property that the seller, vendor or assignor would state that a 40 per cent fee should first be paid but the property would not be assigned or accessed until the final payment is made.”

    Cash payment for properties is not a new thing, especially in Nigeria. But it has been found to be risky, especially if there is a need in the future to track the payment. Adeagbo warned, “When you are paying for land, don’t pay cash. This is a mistake some have made in the past. You can use a mobile app or over-the-counter transfer in a bank so that you can have a receipt of when you sent the money.”

    See More Stories Like This