Profiting from buy-to-let can be a slow business.
More impatient investors may opt instead for a popular strategy of buying, refurbishing, and refinancing (known by some as BRR), which can bring a return on an investment after just six months – 18months
“Say you have a development in a prominent location and are typically selling for N165,000,000. We can find a property or development that requires additional financing and, maybe you can buy it for N115,000,000” said Mr. Adenle.
“You spend very little or none at all on refurbishing depending on the development, to add value, we put it up for sale after 6 – 18 months and it is valued at N165,000,000 you get about 43% return on investment. Finding the properties, however, is increasingly tough.
It is also best to invest in an area that you know well, he added. If you’re buying from out of town chasing high yields, “it is very easy to fall into the trap of buying a horrible property to have to rent”.
Daniel Adenle of myResidential - Real Estate specialist, said the key to a good deal is to be able to prove that you have added value. Developers will take into account factors such as being able to sell quicker and at a higher rate than were previously paid for the property.
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