WHEN RICH MEN DIE, WHAT HAPPENS TO THEIR PROPERTIES?

Monday

When rich men die in Nigeria, is seems the controversy over their properties lingers for years after their death and sometimes for a lifetime. Whether or not they leave a will behind,in many instances makes no difference whatsover to who gets the proceeds of his wealth. We have heard the stories of prominent families where the children have publicly been at war with one another for many years after the deaths of their fathers. Recently a prominent Nigerian died leaving the family home to his wife in his will. It is reported that the older son has taken up residence there, saying that in their culture, the first male child will take over the fathers property. What then does this make the law? An ass?

Tuesday

The Minister for works has promised that from next year, all construction projects below N5 billion (approx $157m) will be handled by Nigerian contractors with the necessary capabilities! He said that this policy was designed by the Federal Government to help build local capacity and promote local content in the industry and rely less on expatriate companies. He said that over 80% of the of the capital budget of all tiers of government is expended on in the construction and engineering industry, which is dominated by foreign contractors and consequently creating a loss in income for the country. The policy he claims is aimed at redressing the imbalance. We sincerely hope so.

Wednesday

The Federal Government has approved the allocation of N2billion(approx $63m) for the construction of the official residence for the vice president in Abuja!  In 2009 N7.1 billion was allocated for the design and construction of an official residence for the then Vice President. We are not clear what has become of that residence. The new official residence is reported to be contracted to Julius Berger and must be completed in 20 months as the Vice President currently resides in the guest house meant for president’s visits! Also 2.2billion naira was approved to construct an additional banquet hall to host presidential ceremonies

Meanwhile, N1.5 billion was allocated for the development of a rail line and N1 billion for health care facilities! Reporters were told at a meeting that the N50 billion allocated overall for infrastructure development for the FCT was inadequate and further intervention funding would need to be found!?……

Thursday

I had to visit some large estates along the Chevron Alpha beach area, which are still in the finishing stages of construction and still fairly inaccessible due to the untarred roads. What struck me about these estates that have been so widely marketed for years, is how poor the infrastructure and quality of construction is. The completed units have been empty for so long that they are already showing signs of decay due to the proximity to the ocean and the high salt content in the air. The developers are obviously having financial challenges as they are not getting the returns on these properties that they had projected for loan repayments. With so many properties lying empty it makes a mockery of the government policies to build more affordable homes for people

Friday

I got a call from a gentleman who wanted my thoughts on setting up an on-line interactive property site. Whilst I thought the call would be brief, he went into facts and figures, keeping me on the line for at least 20 minutes. I jokingly told him I would charge him consultancy fees, to which he spent a further two minutes laughing. I was certainly amused by his proposition, which is what kept me on the phone for so long, but what was clear to me was that he had not researched the property market well enough to realise that his proposal while having good intentions, may not work in the Nigerian property market, which in reality adheres to no regulations or law. I wish him luck anyway!

OWNING vs RENTING

Monday

Everyone I know in Nigeria wants to own their own home, yet not many can afford to do so. In a country where more often than not, you will certainly have to purchase a home outright or if you are fortunate (maybe unfortunate) enough to get a mortgage, then you spend almost double the purchase amount acquiring a property.

Apart from the actual cost of the property, there are other costs to be factored into the purchase, valuation and survey fees, mortgage fees, estate agents fees, legal fees, transfer fees, all the government tax charges etc. Some people are so interested in building the biggest and flashest mansion anywhere they can get land, they forget that the location may not be best suited for living in. They then find that they cannot live in, sell or rent out the property, due to location constraints.

Research needs to be carried out on area prospects (excluding your home town!) before building, as this may help prevent unfortunate mistakes that will make your property unliveable. Renting may be the best option until you can afford what you really want

Tuesday

On the topic of building in the “wrong” location, I was contacted by someone who had put up a 15 bedroom house which he wanted to use as a small hotel, in the Ogba area of Lagos. He started the project five years ago, and was not able to complete it due to over stretching himself financially. He now wants to sell it for “anything reasonable”?

I have said in past articles, that a property is only worth as much as someone is willing to pay for it. Especially a property built in a swamp area with no infrastructure around it.

Wednesday

It is almost the end of the year and the much promised 265 days of rain we were told to expect by the environmental agencies earlier in the year, did not arrive ( maybe it passed over Lagos!). Of course there has been the odd day of heavy rainfall, but nothing compared to last year’s flooding. The Harmattan season will soon be here and we can forget about rain for a while. Temperatures have been so high recently, hitting 32-34c most days, with humidity rates overwhelming. It makes it difficult to work or be outside. Viewings have to be conducted early morning or evening, to prevent heat stroke.

Thursday

Another building collapsed in Lagos, killing the only two daughters of an elderly mother. At the time of writing this the mother was recovering in hospital, but has not been told her only children have been killed! It is a travesty that is played out daily. Unqualified builders build properties that do not stand the test of time, collapsing one day and killing inhabitants. Who is held responsible? The owner of the property? The builders? Or the regulatory agency that passed the building as safe? In most instances none is held responsible and the surviving family members are left to mourn and foot the cost of their loss.

Friday

New residential estates are springing up everywhere in Lagos! Small, medium, big, serviced, unserviced, accessible, inaccessible, well built, poorly built, semi-affordable, very expensive (quoted in $ only), furnished, unfurnished. I could go on, but I am sure you get the drift.
This clearly highlights the need for good quality maintenance of these properties. It is sadly an area that is lacking and needs more input and expertise. A lot of good estates are built, but over a year or two, you begin to witness deterioration in the infrastructure. Facilities management has a long way to go

LAGOS IBADAN EXPRESSWAY SAGA

Monday

Hallelujah!  Superb news today, the Federal Govt has terminated the contractors who were to have repaired the Lagos Ibadan Expressway from May 2009 for 25 years under a design, build, operate and transfer (DBOT) scheme.

For many years that stretch or road has steadily gotten worse causing numerous accidents and loss of life. The 105km expressway is the busiest in the whole of West Africa. Each time I have to ply that road, I have prayed every step of the way. It is a living nightmare. The road is crater ridden, with thousands of oil tankers dangerously parked on the sides of the road. Armed robbery is a daily occurrence. It has become a health hazard and this news could not have come sooner. Well done Fed Govt, I hope many more much need infrastructural repairs will be undertaken to lift the country out of this quagmire of decay, it has fallen into
The contract has been deservedly allocated to Julius Berger and RCC Nigeria Ltd. I know it will take some years to be completed, but we all look forward to some sanity on that road henceforth!

Tuesday

Someone called me today to visit what was previously a hotel, but the owner wanted to turn the 40 room hotel into one bed self contained accommodation for, young people, singles or short stays. This is the third such request I have received in the last two months. It appears that some hotels are folding up due to management issues and the owners want the hotels converted to short stay accommodation. What the owners need to be aware of is that the facility management of this type of accommodation needs to be reliable and immediate. Things like generators cannot afford to break down and have long down times. Security and cleaning need to be top notch! There is no need seeking clients if the facilities are run down.

Wednesday

The Lekki-Ikoyi link bridge that is being built by Julius Berger is approaching completion and is a beautiful sight to behold especially at night when it is lit up. It is a vast improvement on the landscape and surrounding squalor that we are accustomed to seeing. The Government should contract out all the road and bridge building works to Julius Berger. From what I gather the Third Mainland Bridge, despite being shut for repairs for four months, still has a repair problem.

Thursday

The talk on power privatisation seems to be a recurring subject that is not going anywhere. If anything, power supply seems to be more elusive now than at any other time. It appears that from the day after the resignation of the last Power Minister, the power supply to the whole nation dropped by 80%. The cost of diesel has once again risen as demand is high.

Friday

Every day we see different figures and deadlines put out by the Federal Government for the increase in megawatts of power. In 2009 we were to expect 6000mw by that year end, instead it dropped to 2300mw. In 2010, we were told to expect 10,000mw, it never rose beyond 2,500mw. In 2011, we were again told it will go up by year end, again nothing. In 2012 we saw an improvement between June and September to about 5000mw. It now seems back to the original 2,300mw. We are again now told to expect 10,253mw by December 2013…

RESIDENTIAL ESTATES NO LONGER SAFE HAVENS

Monday

In the last few weeks, no less than 7 large gated residential estates in the VI and Lekki areas including private homes have been invaded by armed robbers. This then begs the question everyone has been asking, why are we paying for security guards, if they are not effective in providing security for our homes?  Last week, the biggest private estate in Lagos, had armed robbers enter the estate, it was alleged that a security guard was shot and killed, but all other information has been sketchy. What is interesting is how the power of social media came into play. Within seconds of the the attack, blackberry, text and whatsapp messages were being delivered to thousands of phones. I was with a friend whose husband was on the said estate visiting a friend, when the message came in on my phone. He left the estate immediately my friend called him, but because the estate has closed its gates in a ploy to trap the robbers, no one was able to get in or out for at least three hours.  The robbers were not found, although security on that estate is now tighter than it has ever been.

Armed robbers are now venturing into previously safe havens, like gated estates and quiet upscale residential areas. Nowhere seems safe any longer. Estates are now employing the use mobile policemen, who carry loaded guns and patrol the estates. God help us all!

Tuesday

The media was awash today with pictures of the damage and injury caused by last weekend’s armed robbery gun fire frenzy on some estates along the Lekki Expressway. A resident was mistakenly shot 5 times by policemen who arrived after an hour after a distress call had been made to the local police station. The police armoured van that arrived at one of the estates, came under a barrage of machine gun fire from the armed robbers. Residents on estates are now worried that there seems to be no security available for them, either from the security guards or from the police.

Wednesday

The Lagos State Government has asked all property owners whose properties are located along major roads, to ensure they are repainted and repaired before the Christmas holidays. This is probably a means to ensure the environment looks neater and cleaner than it does at present. There is a severe lack of maintenance of buildings, every here in the state.

Thursday

The Airport road in Ikeja, has deteriorated so rapidly and badly, that it is now a danger to vehicles plying that road, especially travellers going to and from the airport. The airport is a window into the country and says a lot to visitors coming into Lagos for the first time. Urgent attention must be given to repairing the road and clearing the oil tankers on parked on the road.

Friday

It is quite depressing to hear that there is a deficit of 17 million affordable homes in the country. I am sure that the figure is much higher than this, if one was to look at the number of family members or friends, who are permanent visitors in other people’s homes. This issue was raised at the recent Housing Summit conference, held in Lagos this week. There is no real incentive from the Government to help push forward the policies and funding for this sector.

Mortgage institutions are not lending, and in the few instances they do, the interest rates are over 20% and not sustainable, therefore leading to a vicious cycle of non repayment of loans and banks withholding affordable mortgage packages. There was a call for the government and stakeholders to ensure the implementation of the newly approved National Housing Policy document.

HURRICANE SANDY IN LAGOS

Monday

The Lagos State Government has warned residents to prepare for the ripple effect of Hurricane Sandy which devastated parts of the Caribbean and East coast of America recently. We have been warned that in one to two weeks it may arrive here causing flooding or ocean surges which may affect residents along the Lagos coastline. The areas that may be affected include, Kuramo, Oniru, Alpha beach.

If at all we do feel the after effect of the hurricane, it will certainly not be on the scale that it affected the US, where we saw houses razed to the ground, loss of power and and terrible flooding. Even though they were not prepared for it or do not often witness such destruction, they have dealt with it competently and almost every one affected is rehoused with power restored. On the other hand, we in Lagos frequently experience loss of power and flooding, yet nothing much changes and those affected just get on with it as best they can.

Tuesday

I got a call from a client who wished to renew his lease but, was not able to because that landlord and his wife were quarrelling and individually kept putting pressure on the client to pay the money to themselves. At the on start of the tenancy, the rent had been paid to one of them, but now the other party was demanding that it be paid to them as they were the rightful owner of the property. This confused the tenant who wanted to continue staying at the property, but not be in the middle of a domestic dispute which may affect his stay.

Luckily, one party has backed down, the rent paid, and hopefully the tenant can continue his tenancy in peace

Wednesday

On my way to view a property, the car entered a pot hole covered by water and got stuck. This is the third time in as many years that this has happened and is a frequent occurrence on Lagos roads. Luckily some kind hearted passerby’s used their God given man power to push the car out and send us on our way.

Thursday

A client contacted me, as there was a leak into his flat from the flat above him destroying all his personal belongings. He did not know how to deal with this as the other tenants was denying responsibility. Home insurance is very important to protect buildings and properties, unfortunately majority of tenants and homeowners do not have any and instead rely on luck to prevent unforeseen problems. There is a saying that “God helps those who help themselves”

Friday

There is an ongoing land dispute on the island which is quite theatrical to say the least. The Criminal Investigation Department (CID) unit of the police force has been invited to look into the case. It involves a traditional ruler (Oba) and a Chief. The Chief bought a parcel of land about 15 years ago, which he sand filled and started building the foundation for some properties, but ran out of money. He decided to sell the land to someone else about 5 years ago. Recently, there was some vandalism on the land, which revealed that the Oba who wanted it for one of his wives, was responsible.

The police have looked into the matter, invited both parties in and asked the Oba to “settle” the owner of the land

ARE WE BUILDING FUTURE SLUMS?

Monday

There are estates being developed on the outskirts of Lagos and within the Lekki expressway axis that are already showing signs of distress. A few years ago there were communities along the Lagos Ibadan expressway that were touted as the next big investment opportunity since Dubai real estate development. Plots of land were being sold for as low as N250,000.00 with payment plans arranged. It all seemed just too good to be true. These estates were advertised as having infrastructure like tarred roads, running water, security and dedicated transformers for electricity provision.

Some who had always wanted to get on the property ladder but never thought they would be able to afford it at the rate of property price increases, saw this as their opportunity to build a home for their families. Investors bought numerous plots, thinking they would sit on it till prices appreciated, then sell them at a fantastic profit.

What do we have years down the line? Sold out plots with no infrastructure provided, no maintenance, pot hole ridden dirt roads that flood when it rains, no drainage, no running water, residents at the mercy of armed robbers, electricity a long forgotten dream, and to top it all, residents are learning that the plots they bought, may not even belong to them afterall as there is a dispute over landownership and they may have to re purchase their plots all over again! Residents have appealed to the relevant government offices to step into this matter, but no clear answers are being given. Their dreams have crumpled like a pack of cards. The future for these estates is not good at all; already they have deteriorated into slum dwellings at best.

Tuesday

It is sad to see that disputes over land and property sit in courts for years despite receiving titles and deeds from government agencies. Going about buying land the “right” way, unfortunately seems to offer no protection against your land being taken over by someone else. Buyers need to be cautious and try not to buy land directly from land owners unless a genuine Certificate of Occupancy is produced.

Wednesday

It is crazy that some developers would rather cut corners than employ legitimate professionals to construct their properties. Some go as far as employing artisans from the villages who are not as expensive as the city professionals and do not have a clue on safety measures for construction, electrical wiring and plumbing. Unfortunately this only results in the construction of properties no better than village huts.

Thursday

A lot of properties in the Alpha beach area are  falling in value due to the ocean rapidly encroaching on to the surrounding land. Owners of properties that sprung up in the last 5-10 years and had been doing well in terms of sales and renting can only sit back and watch helplessly as the ocean creeps up to their door steps. This has been in the media constantly with the government officials for waterways and environment making numerous visits to the area and promising that measures will be taken to stop the encroachment, yet nothing has been done! No one wants to buy there anymore.

Friday

As we all know security in our homes and in general is a big issue in Lagos and the country as a whole and some people will take any measure necessary to protect their property. I came across a funny joke about this which I will share.

A security firm receives a phone call enquiring about the varying types of security measures provided?  The receptionist answers saying” please what kind of security would you want installed? We have Voodoo, Remote control, Juju, Charms, Spirit gatemen, Touch and start sweeping, Fall asleep  etc” If you let us know which one you prefer, we will give you a quote….

Continuing lack of electricity and fuel…..

Monday

The intermittent petrol scarcity which started a couple of months ago seems to have gathered momentum as queues at petrol stations seem to getting longer by the day despite the governments assurances that there is nothing to worry about! On the back of this is the misery of persistent power cuts which also seem to be getting worse. Estates are stocking up their diesel supply for fear that the fuel scarcity might hit the diesel supplies as well. I may have to work from home next week if I can’t get petrol for my car.

A survey showed that Nigerians spend about N796.4billion on generator fuel every year! That is approximately £3billon or $5billion. The average generator using Nigerian spends between N200k-N2m a year on personal use of their generator. The cost of running personal businesses is a monumental drain on the profits of that business.

Tuesday

The electricity problem seems to be getting worse daily. The repeated promises of increased electricity provision have all amounted to nothing. There has not been any electricity in parts of Lagos in the last week. Generators are being run round the clock, noise and air pollution are major problems that are not even acknowledged.

Diesel tankers have taken over most of our major roads as storage depots, causing accidents, traffic and damage to the roads. The Lagos Ibadan Expressway and the Airport road being classic examples

Wednesday

The rains have started again and every year without fail causes a lot of setbacks to building works. Of course as I have mentioned repeatedly, this is a good time to rent and buy as it exposes a lot of problems with the property and the surrounding area. Property and road construction works are delayed during the rains, sites and roads turn into rivers and lakes which need digging again after the rains have subsided, gutters overflow into roads and drains and plumbing in homes get blocked. It must seem like a lost cause to contractors whose workers seem to spend more time when it rains sleeping and taking time off with illnesses, thereby delaying further the project handover dates.

Thursday

Going round to a lot of building sites is quite interesting, as works are being undertaken at varying speeds depending on the flow of funds available for that project. For some, works have either halted or slowed down considerably. The ones that are continuing are reviewing their spending on materials and fittings, which in many instances may mean compromising the quality of the finished property. At the best of times it is rare to find a really good finished property, but with these cut backs it will be even rarer to find a fairly well finished property.

Friday

A lot of builders, artisans etc apprentice off workers who in the first instance just picked up the trade from some poorly trained electrician, painter, builder, plumber etc therefore never fully mastering their trade and as a result constantly churn out substandard quality of work which to them is what it should be. Developers are desperate to complete their projects and will often take on these artisans through recommendation from a friend, brother or uncle. The finishing in a lot of properties is as a result terrible; something as simple as fitting light switches is a challenge for these workers as the switches are never aligned properly or straight. Don’t mention plumbing works, which is a major concern of which I have had personal experience, and the misery that shoddy work can cause to the lives of inhabitants.

There is a serious lack of training for these workers which needs to be addressed urgently or else we are at risk of our roofs and walls collapsing around us. More regulation needs to be brought into the property building trade

Until next week