Real estate sector lacks proper regulations, encourages quackery – Expert

In this interview with EDIDIONG IKPOTO, the Chief Executive Officer of Whiterose Properties, Kareem Ayobami, speaks on challenges facing the real estate sector and the spate of building collapses in Lagos State

How would you describe the current state of the real estate sector?

The real estate sector in Nigeria is blessed with many investment opportunities but it lacks a well-regulated structure or system. For example, any person can just wake up and award himself/herself a ‘seasoned real estate practitioner’ without passing through any training whatsoever . The consequence of this is the emergence of many ubiquitous real estate agents all over the country who end up either defrauding unsuspecting investors or causing the investors to fall prey to bad real estate investments due to their inexperience and lack of expertise.

Notwithstanding, I commend the efforts of most stakeholders in the private sector who are striving each day to maintain the best practices in real estate. On our part, we have currently taken a step forward to not just uphold the standard best practices in all our real estate transactions but to train and develop as many aspiring real estate practitioners as possible, hence our initiative of Whiterose International Network Platform (WIN) . The WIN is a platform that trains and empowers prospective real estate entrepreneurs and it is part of the Whiterose initiative toward human capacity development and empowerment.

With Nigeria battling inflation at the moment, would you say the real estate industry provides an ample window of opportunity to potential investors right now?

The inflation ‘cancer’ currently ravaging the country is, no doubt, negatively affecting all the economic sectors of the country, the real estate sector inclusive. However, there is still no better time to invest in real estate than now. This is because any investment in real estate can only appreciate, as real estate never depreciates. Hence, inflation can actually be a blessing in disguise for real estate investors due to the speedy rate of appreciation of real estate this period, thereby guaranteeing a bountiful return on investment for investors within the shortest possible time.

Lagos State has experienced four building collapses this year. In what ways can regulatory bodies improve to curb this menace?

The unfortunate incidents of building collapse this year in Lagos State is very sad, especially because they would have been avoided had the relevant government regulatory agencies being proactive and efficient. To avoid future occurrences of these ugly incidents, I advise the Lagos State Government to adhere to the following: Ensure proper licensing and permits for any building construction whatsoever, using the standard global best practice building standards/regulations; ensure constant on-site supervision and follow-up at every stage of construction to ensure strict compliance to building regulations, and swiftly and immediately seal off any development or construction that is found violating the established building regulations and demolish same where the situation demands.

The state government should ensure proper supervision of the personnel directly involved in the supervision of any given construction in order to detect any possible compromise due to bribery and corruption. It should severely punish any person or firm that is found circumventing the building regulations irrespective of the violator’s status to serve as a deterrent to others.

There have been criticisms that most developmental projects in Lagos State are made for the upper class. Is this true?

This isn’t true. I, for example, was once a homeless person in the streets of Lagos and could not even boast of a good two-square meal at the material time, but today, I not only own homes, I develop and sell to others. If I can, anybody can. The problem is ignorance.

What are the opportunities in the facility management subsector?

At the core of property investment is maintenance and sustainability, that is where facility management comes in. To guarantee the desired return on investment on real estate investment, the property must be effectively and efficiently managed by experienced professional facility managers, hence the increasing need for the same in the real estate sector. It implies, therefore, that the business opportunity in the facility management sub-sector is enormous, though challenging.

In terms of regulation, would you say your industry is over-regulated or under-regulated?

In my opinion, the problem of regulation in the real estate sector in Nigeria is neither over-regulation nor under-regulation, but the problem is rather effective enforcement of various regulations. In other words, as various regulations are not being effectively enforced, it is either the regulations are overwhelming the enforcement apparatus or the system of enforcement is incompetent as a result of corruption. I will, therefore, advise the government to concentrate on developing corrupt-free and viable enforcement agencies that will implement the current regulations on ground.

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