There are a lot of real estate terms and terminologies in Nigeria. Trying to understand the meanings of these real estate terms can be quite overwhelming.
We’ve taken the opportunity to explain some of these real estate terms and phrases used a lot in Nigeria. Whether you intend to buy, sell or rent properties, these terms will definitely come in handy.
Here are the 20 most popular real estate terms in Nigeria and their meanings:
1. Certificate of Occupancy (C of O)
The Certificate of Occupancy is a document issued by the state government that grants ownership of land to its holder. This document gives the owner the rights to occupy and use the land. A Certificate of Occupancy in most cases has a duration of 99 years. After this period, you can apply for a renewal. The C of O can only be granted to the first person who purchases the land.
2. Deed of Assignment
A Deed of Assignment is a legal document that transfers the ownership rights of a given property from one party to another. This document is proof that the land has been transferred to a new assignee and is issued by the legislative body.
3. Survey Plan
The Survey Plan shows the exact position, dimensions, size, boundaries and features of a piece of land. It is usually prepared by a licensed surveyor and contains the name of the surveyor, the license number and the date, it also tells you if the land is excised or under government acquisition.
4. Governor’s Consent
The Governor’s consent is a document that shows the governor’s approval of a land transaction. This document is needed to validate any land transaction in a given state. The Governor’s consent can be obtained anytime there is a change of ownership on a property since the Certificate of Occupancy can only be given to the initial owner.
5. Land Use Act
The Land Use Act of 1978 grants the governor of a state the sole responsibility or control of all lands in the territory they occupy, except for lands under the federal government. They also govern land transactions and allocation. This act is what states how you can use or manage lands within a given state. It gives individuals or communities the right to use land but not outright ownership.
6. Building Approval
Building approval is the official permission granted by the local government or authorities for the construction or renovation of a building. This approval ensures that the building is in compliance with the local building codes or regulations.
7. Real Estate Developer
A real estate developer is in charge of transforming raw land into a well-developed property. This individual or company designs and constructs buildings and also manages and maintains developed properties.
8. Site Inspection
Site inspection is the verification of a property’s condition, location and surroundings before purchase, to ensure it fits the description given by the seller. This inspection is necessary to identify potential issues and access the neighborhood.
9. Property Tax
Property tax is a tax the owners of a property pay to the government. It is usually an annual tax levied by the governing authorities on property owners. Property tax in Nigeria varies by state or local government. What determines the tax you will pay are the property value, location and usage.
10. Real Estate Agent
A real estate agent helps facilitate the buying, selling and renting of properties. They usually represent property owners and advise on property investments. Real estate agents connect buyers and sellers, they market properties and negotiate property prices.
11. Excision
Excision refers to the process by which the government releases a portion of land from being classified as government-owned. All land is under the control of the government according to the Land Use Act of 1978, when the government carves out a piece of land, that land is no longer under government acquisition. It means private owners can now apply for a Certificate of Occupancy.
11. Gazette
This refers to the official government record of lands that have been excised. This record is proof that the land formerly under government control is now free and you are free to sell or develop it. An organization or group can use this document to seek the Governor’s consent or Certificate of Occupancy (C of O).
Also Read: Difference Between Land Excision and Gazette in Nigeria
13. Omo Onile
‘Omo Onile’ is a Yoruba term that refers to local land owners, or indigenous families who claim ownership over a piece of land. Omo Onile is prevalent in the southwestern region of Nigeria like Lagos, Osun and Ogun states. In Lagos, your ability to establish a friendly relationship with the omoniles can help sort out land disputes or verification faster.
14. Down Payment
Down payment refers to the initial payment made when purchasing a property. In Nigeria, a down payment is usually a percentage of the total price of the property. Down payments are made to secure a property or show financial commitment.
15. Development Levy
A development levy is a fee an estate, the government or local authorities charge for the development and maintenance of a given community. They use this money to maintain roads and drainage systems. In addition, they also use this money to take care of other pressing needs in the area.
16. Freehold
Freehold refers to a type of property where the buyer has full control and ownership rights with no time limit or restrictions. A residential freehold for instance entails owning a house or land indefinitely.
17. Building Plan
A building plan is a detailed design and layout of a building, showing how it will be constructed. This includes its dimensions, size and structure. A building plan is like a blueprint for a building. In Nigeria, building plan approval is needed from local authorities to ensure it meets the zoning regulations and safety measures.
18. Capital Appreciation
Capital appreciation refers to the increase in value of a given property over time. This happens when the price of a property goes up, this could be as a result of market forces or economic trends.
When capital appreciation occurs, the property owner can sell at a higher price than they bought it. This is one of the major reasons people invest in real estate, as the value of a property increases, so does the price.
19. Land Banking
Land banking is the process of buying or investing in a piece of land and holding on to it for a long period, with the intention of selling it when the land appreciates in value. Investors usually buy land at a low rate and wait for the area to develop. This can take a while.
As the value of the property increases, they sell it at a higher price. The land is a financial asset that you always use as collateral in securing loans from banks.
20. Estate Management
Estate management refers to the supervision of properties usually within a gated estate. Estate management deals with the maintenance of the area, provision of security, and utility management. They are responsible for handling the day-to-day running of an estate.
Also Read:
- 10 Different Land Titles You Should Know in Nigeria
- How Much Does It Cost to Buy a House in Abuja?
- How to Save Money for Your First Real Estate Investment in Abuja
Conclusion
Learning these real estate terms will help you understand the key documents needed when investing in real estate in Nigeria. It helps you know the roles of different people involved in the real estate market.
Knowing these terms also gives you a level of confidence and awareness when discussing matters concerning real estate in Nigeria.
The moment you understand these terms, they will broaden your knowledge of the real estate market in Nigeria. When it comes to real estate investing in Abuja, Asaba or Lagos, your knowledge of these terminologies will help you make a good decision.
Are there other real estate terminologies you wish to see in this article? Let us know in the comments section or on our Facebook page.
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