The real estate purchase is one critical step every person who is gainfully employed is bound to make at one time or another. Apart from having a place to call home, real estate has become one of steady investment alternatives in Nigeria. Nowadays, it appears everyone seems to be interested in an offer for sale of land or building in one developing area or another. Majority of the new estates that offer land or house for sale are in Lekki, especially in Ibeju Lekki area of Lagos.
First, anyone purchasing a property from a private developer should not just make payment detail enquiry. It is always appropriate to engage the services of a lawyer to help trace and search the title of the property one intends to purchase.
The fact that the property that is about to be purchased falls within a big estate does not confer a good title on such property. In this country, we have witnessed a circumstance where a large estate was pulled down in Abuja because of a bad title as alleged. I have also heard of people who have purchased properties in some of the big estates and are unable to perfect their title for more than a decade.
The second precaution that is key is for the buyer to seek to perfect his or her own title. Subject to the provisions of Land Use Act, Governor’s consent is required in every state except the Federal Capital Territory that falls under the jurisdiction of the Minister of F.C.T. A buyer’s failure to perfect his or her title is as good as no lawful transfer of property has taken place in accordance with the records in the registry of that state.
Section 1 of the Land Use Act stated that all lands in each state are vested in the governor of such state to hold in trust and administered for the use and common benefit of all Nigerians. Where a buyer has neglected to perfect his or her own title, or the developer or assignor has also neglected to perfect his own title too, the governor of such state might still lay claim to such property for overriding public interest without any compensation to the affected owner.
The third but not the least precaution a buyer should take when buying a property from the developer is to insist on a contract of sale, especially when a developer is asking such buyer to pay a premium on the land for some proposed infrastructures such as electricity, road network among others.
Contract of sale is a preliminary agreement in a land transaction before a deed of assignment. In a situation where the developer is offering a buyer 6 months or 2 years payment’s option, the buyer is at mercy of such developer if there is no contract that defines the rights and obligations of both parties. I have heard of different people who have cried out severally to complain that their developers arbitrarily increased the price of an agreed property, especially a bare land after they have made deposits for such property.
Contract sale will usually prevent gazumping i.e. owner or developer can not unilaterally increase the price of the property again as long as the purchaser is still keeping to his own side of the bargain by making timely payment as agreed.
In conclusion, I would suggest that anyone seeking to buy a new home should not do so without a consultant, often a legal practitioner who can properly ascertain the risks associated with such transaction or property in question. A lot of good developers out there have kept to their promises by delivering what they promised, but you can never predict what your own developer might be up to. But it suffices if as a buyer, you have done the right thing from the beginning.
Written by Olusola Jegede, a Partner at Resolution Law Firm, one of the leading Property Law Firms in Lagos