Investing in real estate can be profitable, but it’s essential to understand the laws and rules before starting. Nigeria’s real estate market has specific regulations, which can be complex, especially for foreign investors. This guide will help you understand the legal aspects of buying property in Nigeria, ensuring a smooth and secure investment process.

Land Ownership and the Land Use Act

In Nigeria, the state government controls all the land and acts as its caretaker. The Land Use Act of 1978 sets the rules for owning and using land. According to this law, people or companies can only get land rights through a Certificate of Occupancy (C of O) issued by the government. This is a crucial part of any real estate transaction, as it determines how land can be bought, sold, or transferred.

Types of Land Titles

Before buying property in Nigeria, it’s essential to understand the different types of land titles and what they mean:

1. Certificate of Occupancy (C of O): This is the main land title, giving the holder the right to use the land for a set period, usually 99 years. The state government issues it.

2. Governor’s Consent: After getting the initial C of O, any further transactions need the Governor’s Consent to be legally valid. This ensures that the government recognizes and records the transaction.

3. Deed of Assignment: This document shows the transfer of land ownership from one person to another. It must be registered with the state’s land registry to be legally binding.

4. Deed of Sublease: Sometimes, a landowner may lease the property to someone else. The deed of sublease outlines the terms and conditions of this arrangement.

5. Survey Plan: This detailed map shows the exact boundaries and measurements of the property. It helps avoid disputes over land boundaries.

 Due Diligence

Doing due diligence means carefully checking all aspects of the property before buying. Here’s what you should do:

1. Verify Land Title: Ensure the property has a valid title. Check with the relevant land registry to confirm that the documents are genuine.

2. Check for Encumbrances: Find out if there are any existing mortgages, disputes, or unpaid taxes on the property.

3. Engage a Qualified Lawyer: A knowledgeable real estate lawyer can help you understand the legal details and ensure all necessary documents are in order.

4. Conduct a Physical Inspection: Visit the property to check its condition and ensure it matches the legal documents’ descriptions.

Key Legal Considerations

1. Taxes and Fees: Be aware of the different taxes and fees that come with real estate transactions in Nigeria, such as stamp duty, capital gains tax, and registration fees.

2. Land Use and Zoning: Understand the zoning laws and land use regulations where the property is located. These rules can affect how you can use the property.

3. Dispute Resolution: Be prepared for possible disputes. Knowing how real estate disputes are resolved in Nigeria can save you time and money.

4. Foreign Investment Restrictions: If you’re a foreign investor, know the restrictions or requirements for non-Nigerians buying property. Following these rules is crucial to avoid legal problems.

Understanding the legal landscape of real estate in Nigeria can be challenging, but protecting your investment is necessary. You can make informed decisions and reduce risks by learning about the key legal aspects, doing thorough due diligence, and working with qualified professionals. Whether you’re buying land, a home, or a commercial property, being well-informed will help you secure your investment and achieve your real estate goals in Nigeria.