IS REAL ESTATE REALLY A RISKY INVESTMENT?

Acquiring lands and property is a dream come true for most people. A lot of people save up their hard-earned money over months or years with the hope to buy a property that will give them rest and peace of mind.

Unfortunately, a lot of people still end up buying fake and unverified properties. Some real estate developers and agents’ properties and lands to people without papers. Even in 2021 many still fall in their trap.

There are a lot of stories from people about how they were scammed, this one from omonilelawyer is one of many.

 

YOUNG COUPLE LOSE N6 MILLION IN IBEJU-LEKKI REAL ESTATE COMPANY SCAM

Omonilelawyer was contacted by a young couple to assist them in recovering N6,000,000 paid to a popular real estate company for a piece of land in Ibeju Lekki who defrauded them. The young couple claimed a part of the money was given to them as a wedding gift by an uncle while the remaining was sourced through joint savings. Instead of lavishing the money on frivolities and luxuries, the couple agreed to invest the money in real estate as a way of securing their future.

Having heard several dreadful stories about Omoniles over the years, the newlyweds decided to purchase land marketed by a real estate company as they believed it was much safer to buy from a real estate company than the ferocious Omoniles they have heard so much about. 

The couple were asked to pay a down payment of One Million Naira (N1,000,000) while the balance sum of Five Million Naira (N5,000,000) was to be spread over a period of 12 months. The Real estate company promised to allocate a plot to them as soon as complete payment was made. 

The couple informed us that 2 years down the line, in spite of making full payment totaling N6 Million (N6,000,000) as instructed, the company was yet to allocate a piece of land to them. Despite several phone calls and visits to the office of the company, the couple were always told the Managing director was not in the country. The couple were desperate to either get their land or money and approached us to find out what was going on because it was taking a toll on their marriage.

Immediately we got the consent from the couple to verify the real estate company, we swung into action. We hid our identities and pretended to be buyers. The chief marketing officer of the real estate company gave us a sweet lecture about the company and the need to buy into their estate. They told us about all the advantages of buying a piece of land close to the Dangote refinery and that their title documents were very good. We asked for their title documents to investigate but the Chief marketing officer bluntly told us that they do not give or show clients their title documents except that we are ready to pay for the lands now. We pleaded with them to give us something to convince our partners to pay and they reluctantly gave us the perimeter survey of that estate and told us that would be enough to convince us that the estate was legit.

With that, we began our investigations and it brought out the following:

  • With the Survey plan, we were able to trace the original community owners of the land of the estate. We were told that the real estate company had only paid 30% of the cost of the land and had been in default for 2 years. We were also told that they had sold off their own 30% and they had no right to sell the remaining 70%.
  • We further gathered that the survey plans the real estate company was parading around and giving to clients did not contain the portion that the real estate company purchased. The community owners claimed that the real estate company has already breached the contract of sale they signed 4 years ago, and they would soon invade the estate to pursue anybody they see on the land until their money is paid.
  • Also, we discovered that the estate had no Excision. What the community had was an Excision in progress and they have been trying to process the excision for so many years but due to lack of funds, they abandoned the processing of the Excision, and they were not sure in the near future when it would be done. This was contrary to what the Estate told us previously that the Excision would soon be out.
  • We also found out that the managing director of the real company had also defrauded several clients and disappeared abroad.

We presented our search report findings to the couple who were very troubled that they fell victim to a dubious real estate company. We advised them on what to do and how we could help them recover their money. Unfortunately, after a protracted battle for a year, we were only able to recover 1.5 million Naira out of 6 million Naira from them before the company owners abandoned their office and estate. They left hundreds of people who bought into the estate in debt and the couple was one of the lucky few who even had a little refund.

This could have been completely avoided if the couple had conducted a search on the property before transferring a dime to the real estate company.

“They got swayed by the sweet tongue of the agent, the fancy fliers shown to them in their email box promising them wonderful things if they purchase lands with the real estate company and the well-edited Instagram videos used to promote the real estate. When the problems cropped up, the Instagram videos, Flyers and silver-tongued agent could not help them out”.

This was the sad fate of this couple and many other Nigerians. Property transactions in Nigeria can be scary sometimes but are we going to stop buying lands and houses because of these stories?

HouseAfrica is building a modern property record system powered by Blockchain Technology to help homebuyers and financial companies to access, verify and value properties effortlessly. We are creating a record system where real estate developers can upload their land and properties; home buyers can now view and verify a properties location without the fear of being scammed.

This will help curb the fraud in the real estate sector and also build brand trust for the real estate developers.

HouseAfrica is creating a solution and filling the loophole in the property transaction chain.

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