From tenant to homeowner

Abiodun Doherty

The journey from being a tenant to becoming a homeowner is different for everyone who has achieved that feat. Although there are common denominators in all the several stories, the uniqueness of every individual makes the journey both personal and special. Every man has his or her race to run and the time it will take every man to achieve this feat will differ especially if it is the first time. The good news is that we can learn from each other and be encouraged that since some have done it before you too can do it.

The first obstacle on the path of several individuals is nice landlords or landlady’s, good neighbourhoods and convenience. Human beings generally do not like to move from their comfort zone. There are several people who are renting not because they cannot afford their own home but they do not want to change the environment they are already accustomed to. Sometimes the consideration is the location. Some people do not want to consider building their own home because they cannot afford the location they are already accustomed to and are afraid of relocating to a neighbourhood they can afford .

Common victims of the above obstacle are top civil servants and those working in big private companies that make provision for accommodation in high brow neighbourhoods for their middle level to the top level of their management .This arrangement often saves the staff a lot of money whilst removing the ‘push factor’ that propels many to place owning their own home on the front burner.

Proximity to key places of interest to a tenant and the inability of some tenants to afford those locations has further encouraged some to stay as tenants. The challenges of owning a home in an area without basic infrastructures and having to commute to the city centre for critical services has a discouraging effect on some people. All this notwithstanding, to begin the journey, you need to have the desire and take concrete steps to achieve your dream.

But then there is the all important question of when you should start planning to be a homeowner. My answer is that you start now with whatever you have. The earlier, the better because even if you are not tired of being a tenant one day your landlord will be tired of being your landlord. When you stay so long in a property as a tenant several things can happen to make your further stay unattractive to your landlord.

One of the challenges many landlord’s face is how to handle old tenants. Tenants that have stayed too long in a property often end up integrating closely with the owner and the neighbours. They often use this relationship to negotiate lower rental increases than fresh tenants. They often co-ordinate the activities of other tenants sometimes to the detriment of the owner’s interest. For instance, when it comes to rent increase older tenants in a property are likely to insist on a smaller margin and this attitude will often pitch them against their landlord. Those who are smart will move out of the property into their own property before the situation degenerates.

The selection of the location of your first home has a lot to do with your financial capacity at that time. Many people miss several good opportunities because they refuse to look at opportunities they consider below their expectation. This should not be the case. Remember that your first home need not be your only property and it is perfectly okay to start small. Instead of turning down several opportunities and waiting for the day when you will have several millions why not begin to invest in real estate now with what you have.

Some years ago I met a young barber whose educational level was not more than high school who shared with me how he bought his first parcel of land and built his first house .According to him, because his income was low he joined a co-operative society that encouraged its members to engage in weekly savings with whatever they can afford.

At the end of each   month a member of the co-operative was given the entire contribution made by the members. Most of the members were artisans and tradesmen. When it was his turn he used his money to buy a parcel of land. And over a period of three years he was able to start and complete his first property. Using the same principle and strategy he was able to buy his second property on which he built two shops. Conservatively, the values of these properties are now about N10m.

Many young professionals earning several times what this young man earns could have achieved a similar feat but have not because they are busy trying to impress others with fancy clothes and cars rather than investing in their future. Many keep changing their cars every year while staying in a rented apartment without any significant real estate investment. The journey from tenant to a homeowner is one that you should begin now. Time and opportunity waits for no one