A REAL ESTATE BUSINESS IDEA THAT I HAVE BEEN NURTURING FOR A WHILE.
Why isn’t there a real estate company that helps people come together to build their houses with their own money?
What I see everywhere is a man uses his own money (or bank loan) to build houses and then sells them at a profit.
Why isn’t there a company that follows this process:
1. Find a land of maybe 20 million naira.
2. Draws a sketch and intense planning to build say, 6 units of 3bedroom flats on it. The cost of the building comes to maybe, 60million.
So land and building is a total of 80m.
3. Makes a call for 6 people to subscribe to this plan. He shares all details. Legal and all other stuff are done.
4. 6 people each should pay about 13.3m but they are asked to pay 15m each, maybe in 3 installments of 5 million each.
5. The project starts, the company collects all monies, supervises the project, keeps perfect records for the 6 owners, calls them to meetings at various intervals, and manages the building until completion maybe in 4 to 6 months
6. Company invites all 6 owners for an official handover of keys and a detailed account of how their money was spent. Legal is involved again.
7. Company earns maybe 10% of all the cost, as their fees. Any balance money is returned to the 6 owners or owners are asked to pay some extra.
The company moves on to do this for more and more people.
This is a slightly different model from the usual build-and-sell model that real estate guys are all doing.
In this model:
– housing is far cheaper (imagine paying maybe 16m and getting a nice flat in a middle-class premium area)
– homeowners are involved in their project from start to finish, so they get better quality output
– the project is done faster because the 6 owners are fully committed and paying their money on time
– real estate company doesn’t need to borrow from the bank and inflate the cost with huge interest charges
– absolutely anyone who is good with building and project management can start a real estate company in this model, provided he has a very high trust score.
Of course, this business model has many more details that I have not included here. This is just a brief of my thoughts.
Of course, the numbers used here are for illustration purposes, so one should come here and start dragging that land in your area is 500k, and that building 6 flats costs 2 million in your area.
This is just my dream about the kind of real estate companies I would love to see.
I would love to key into a small project where we all know ourselves and our engineers and we can monitor progress nicely and the real estate company is accountable to the last penny.
The cost of owning a home would drop significantly and many homeowners will be made.
As long as I live, I will keep having beautiful dreams about Nigeria.
I don’t care what you think about Nigeria, I am personally permitted to dream my own Nigerian dream.
I love you!