What are the important real estate fees and charges you should know when buying land and property in Nigeria? When you buy a car, there are certain fees that you will need to pay to drive that car smoothly on the road without any issue from the police, VIO, or Federal Road Safety Corps.
If any of these paramilitary stops you and you couldn’t provide genuine papers for that car means you will face the law.
In real estate deals, this is somehow similar when buying or paying for a particular property.
But I realize that most first-time property buyers don’t know about paying real estate consultancy fees, surveyors, and Legal fees.
Whether you are buying land from a real estate company or Omo-onile there are some real estate fees and charges you should know when buying land and property in Nigeria.
Even with these fees, most experienced and first-time real estate buyers will cut corners and tend to shy away from the truth which at the end of the day land most of them in trouble.
Below are real estate fees and charges you should know when buying land or property in Nigeria to help guide you in your purchase.
What fees are applicable when buying a house?
1. Agent Fees
If you will buy a house or land, it is best you tell a real estate agent and of course, this comes with you paying for their consultancy fee. It is their job to search for what you want and make sure they work within your budget, location, and preferred specification
Searching for your preferred land or property by yourself is time-consuming and not easy at all.
A well-experienced and skillful real estate agent doesn’t provide their services for free so be prepared to pay the agreed commission to them for finding the perfect ad to closing the deal and signing the necessary documents.
Real estate agent commission percentage in Nigeria
What percentage do most real estate agents charge? Real estate commissions can be negotiated, but they typically run about 5 percent to 6 percent of a home’s sale price. The exact terms of an agent’s commission vary from sale to sale and can depend on region and which firm they work for.
For the sales of residential property, the fee could be 5% of the total price the buyer paid for the property. So, if a buyer is paying ₦15 million home, the buyer will need to pay ₦750,000 to the agent for his work. When it’s a commercial property, the fee is normally as low as 1%. So, for example, if you are buying an ₦80 million hotel, your agent will receive ₦4 million in fees.
How much are the legal fees for buying a house or land in Nigeria?
2. Legal Fee
A legal fee is money a legal practitioner gets when he offers legal services to a client. These fees are prescribed in the scale of charges for legal practitioners.
Some legal practitioners may bill you on an agreed percentage by both parties for the property sales transactions. Some Real estate attorneys in Lagos Nigeria often charge 5% of the property sale price. The attorney’s fee should be paid separately from the agent’s fees.
Apart from the real estate searching or getting you your preferred land in a better location, you will need a surveyor to chart that land to avoid losing your money to scammers.
If you buy your land from real estate companies, you might not be needing this service as they take care of this but if you had to deal with land grabbers this surveyor service is what you will acquire immediately for property verification.
4. Taxes on Real Estate
It is now impossible to purchase any sort of a real estate in Nigeria without paying the relevant taxes. Property registration fees, personal income tax, and other taxes are common examples. The amount of taxes you’ll pay is mostly determined by the location, size, and type of property you’re willing to purchase.
5. Infrastructural Development fee
This type of fee is typically paid when purchasing apartments or when purchasing land for development in a new neighborhood. The money for infrastructure development is utilized to improve the area.
You must contribute to the infrastructure’s development in order to use the latest facilities accessible.
Check with your real estate developer before purchasing the property to see whether there are any necessary infrastructure development costs and how much they are. If there are, request that the developer include the fee in the final version of the purchase contract so that there are no surprises.
Before you embark on any real estate deal make sure you negotiate the real estate fees and charges you will be paying for agencies’ fees and legal practitioners. When terms are agreed you can relax and let them do their job.
Also, note that you have the right to fire your agent and legal practitioner if you are not satisfied with their services. Do due diligence before you hire the real estate agent, legal practitioner, and surveyor.
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Adeyeye IfeOluwa is the owner of LandSprout.Com, a Web Design & Developer, Digital marketer, Real Estate Consultant, and Content developer.
Landsprout.com came with a passion to help you achieve wealth in real estate investment and solve the hassle within it.
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