The real estate sector in Nigeria contributed 6.39 percent to the country’s GDP in Q1, indicating its potential for growth and job creation. However, the sector faces challenges such as high market volatility and hostility, with experienced realtors and developers gaining a competitive edge due to skewed policies and a selfish pursuit to maintain wealth accumulation in an exclusive cycle. This highlights the need for more investment in the real estate sector to ensure its continued success.
Startups in Nigeria’s saturated real estate market must learn from real estate coaches and professionals to build competence, resilience, and strategies to succeed. Effective coaching and research align with world scholarly standards. The article addresses pressing challenges and provides unique strategies to keep startups above the competition.
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Nigeria’s Real Estate trajectory
Real estate in Nigeria has experienced significant growth since the mid-20th century, with a boom in the 1970s due to oil exportation and urban infrastructural development. The industry’s value is attributed to factors such as urbanisation and technological advancement. The rising urban population has led to a surge in demand for affordable and luxury homes, with technology simplifying the process for realtors and investors. The World Bank reports an annual urban population growth rate of 4.23 percent in Nigeria, indicating a high demand for industrial, residential, and commercial properties. However, Nigeria faces a housing deficit of 20 million units, which is worsened by inadequacy in construction supplies, high-cost materials, and land acquisition issues.
Challenges
The need for a defined strategy to guide the operations of a realtor in the real estate industry can no longer be overemphasised. It’s in this vein Umeh and Ogbu (2020) claims that the only sure way to ensure success in the real estate industry is through effective coaching and mentorship which will provide them with the required skills and knowledge to harness the opportunities within. Understanding the challenges faced by newbies of the niche is somewhat a need, as emphasised by Afolayan (2019), to overcome these challenges, it’s needed to understand the roots of the problems. Below are the challenges faced by start-up realtors in Nigeria:
Fluctuating and limited market knowledge:
Startup realtors, despite having theoretical knowledge, face challenges in the saturated real estate market due to knowledge gaps and varying property values. Misguided entry can lead to financial losses and reduced client attraction. Economic fluctuations and property value destabilisation further complicate the situation, leaving realtors uncertain about investment, planning, or pause. This uncertainty can lead to indecisive decisions for their clients.
Access to capital
Venturing into real estate as a startup is hectic and can be financially demanding. Even if real estate is seen as a profitable venture, it’s more perceived as ‘high risk.’ Banks and traditional financial institutions have declined credit loaning facilities for startups and this poses a significant barrier for progress. Finance remains a significant barrier for start-up realtors. The Central Bank of Nigeria (CBN), attests that mortgage financing is underdeveloped, having the barest rate of only 1% of Nigerians accessing mortgage loans. This only keeps the wealthy afloat and strangles the poor with high dreams.
Technological constraints
The real estate sector is being transformed by new technologies like PropTech and CRM software, which connect realtors to investors and facilitate easy communication. These platforms offer customer-oriented systems for filing and documentation, but their lack of technical know-how hinders the success of startups in the real estate niche. PropTech and CRM software provide a new dimension to the industry, but their implementation remains a challenge.
Networking and credibility
The real estate space thrives by networking and credibility. Not being people-centric as a realtor will undermine the progress that you make. The people in question are industry giants and gurus with a wealth of experience. Unfortunately, the real estate space operates within a cycle that mostly secludes newbies, leaving them at a disadvantaged point. This is heartbreaking because from a networking avenue trust and credibility is established, people can know you and understand the unique solutions you’re offering, hence leads to referral. Here, start-up realtors stand the chance to learn negotiation and client management skills in order to stand side-by-side with competitors.
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Marketing and branding:
For beginners, building a recognizable brand on digital platforms is thoroughly difficult because there’s little or nothing to show potential clients. This demands time, energy and above all, knowledge to scale through. Because of this ineptitude, it heavily contributes to the frustration of beginners, limiting the realisation of set targets and return on investment.
The way forward
Business coaches must teach these startups that challenges are a gateway to being immersed into the real estate process. That addressing these challenges demands a multifaceted approach through continuous and open learning, technological awareness and a host of other approaches. Below are strategies to employ, moving forward as a startup:
Strategic mentorship set-up:
Coaches should steadily organise workshops and trainings for her clients to give them more exposure and information about ongoing trends, development and recent practices centred around the niche. This professional development presents start-ups in a different light because of their profound awareness on taking up the right decisions in smart dimensions.
Digital branding and networking:
Coaches need to teach the importance of corporate branding online. The brand of a realtor is expected to have a face value on social media, that which reflects their value and expertise. With this, people can see and resonate with the brand. The building of a brand must be consistently followed using smart social marketing cues like search engine optimization (SEO) to reach desired audience. When this is realised, the next step is to strategically involve yourself in industry meetings and workshops to build a network of likeminds. When there’s a good network involving industry experts, developers, investors and other realtors, there’s a high chance that you’ll be referred or gain better insights on how to excel.
Financial discipline
Looking forward, coaches should inculcate good budgetary and financial skills on startups. A financial plan should be designed and adhered to, that way it covers for marketing expenses, investment, and mortgage options. This understanding is basic and crucial to a realtor because of the wealth circulation the niche produces in the long-term.
Communication competence
Effective communication is the key to attracting and sustaining clients within the real estate scope. Startups need to understand basic communication etiquettes such as prioritising clients’ needs, active listening, feedback and emotional intelligence to actively engage the client at all times. If these are successfully exerted, clients get retained.
An implementation of these strategies is the guide start-up realtors in Nigeria need to fill the gap that allows them to sulk and stay distant in the realm of affairs.
Conclusion
The Nigerian real estate market presents a plethora of amazing opportunities amidst its challenges. However, the one sided flourish of the industry doesn’t include startups, ensuing a disturbing divide. These beginners need to be well-equipped with training from seasoned professionals to understand the intricacies of the market and the dynamics that enables a realtor to thrive in the saturated landscape. Punctilious and effective coaching strategies are therefore mandatory necessities to maintain a flourishing real estate market in Nigeria.
Oladipupo Timothy Clement is a highly accomplished Real Estate and Business Coach with a career spanning over two decades. He is the Founder and CEO of Lifepage®️ Property & Investments Limited, a leading real estate company in Nigeria.
