Legal Guide For Buying A House In Lagos Nigeria

Buying a house either for investment, commercial purpose or residential purpose in Lagos Nigeria involves a series of legal procedures to ensure a smooth and secure transaction.
Nigeria Real Estate and Construction
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Buying a house either for investment, commercial purpose or residential purpose in Lagos Nigeria involves a series of legal procedures to ensure a smooth and secure transaction. Although, a real estate agent can find a house for someone, but it is important to note that the service of a property lawyer is very key in purchasing a house in Nigeria because some of the factors to be discussed in this article.

LEGAL STEPS FOR BUYING HOUSE IN LAGOS NIGERIA

The following legal steps are crucial and must be carefully followed for buying any house in Lagos Nigeria:

  • DUE DILIGENCE/INVESTIGATION

The first stage of any property transaction in Nigeria is the conduct of due diligence or investigation of the property. Before making an offer, Purchaser through his Solicitor must conduct a thorough investigation on the property to verify the ownership of the property, check for any encumbrances (such as mortgages or liens), and confirm that the property is free from any legal disputes or pending litigations.

Searches may be conducted in the following places or manners:

  • Lands Registry: - In Nigeria, Land Registry are typically managed by the state governments, by virtue of Land Instrument Registration Law, each state in Nigeria has its own Land Registry responsible for recording and managing land transactions within its jurisdiction. To search for a property at the Land Registry in Lagos, Nigeria, such search may be conducted at Lagos State Land Registry, Alausa, Ikeja, Lagos State.
  • Charting at Surveyor General Office: - Purchaser's Solicitor can also apply for a land information certificate from the office of the Surveyor General of Lagos State at Ikeja, Lagos. The process it takes to apply and obtain a information for the enquired property is known as charting. The charting will reflect whether the land falls under any government acquisition or not. The result of the charting will enable the Purchaser's Solicitor to properly advise the buyer accordingly.
  • Corporate Affairs Commission (CAC): - It is safe to note that search at the Corporate Affair Commission is of utmost importance where the owner or the vendor is a business incorporated under the Companies and Allied Matters Act. Purchaser's Solicitor must conduct this search even when the previous search has indicated that the vendor or previous owner has a good title to the property, in other to ensure that the property is free from any registered charge against the company's assets at CAC.
  • Physical Inspection: - This is the inspection and assessment of the condition of the house to identify any potential issues. This inspection is crucial to avoid purchasing a property with hidden defects, structural problems and also to confirm if the dimensions of the land conform with the dimensions on the survey at the land survey office.

STAGES IN BUYING HOUSE IN LAGOS NIGERIA

  • CONTRACT STAGE

The contract stage typically occurs after purchaser has made an offer on a property and it has been accepted by the vendor. Below is an overview of what typically happens during the contract stage:

  • Contract of Sale: - This is usually a preliminary document to tidy up the transaction between the Vendor and the Purchaser. At this stage, the Purchaser, through his Solicitor prepares a Contract of Sale after having established a genuine title to the land or property, offer has also been made on the property and it has been accepted by the vendor or property owner. This is important in order to prevent the vendor from reselling to another purchaser probably because of a higher offer.
  • Disclosures and Documentation: The vendor is usually required to provide the purchaser with certain disclosures about the property, such as known defects or past repairs. The purchaser may also need to verify various documents and information required for the closing process.
  • Closing: Purchaser and the vendor meet to sign the Contract of Sale document and exchange funds.
  • ASSIGNMENT STAGE: -

Assignment stage is the stage where title of the property is transferred to the Purchaser by the property owner and the Purchaser takes full ownership and possession of the Property. Here's an overview of the assignment stage:

  • Deed of Assignment: - A Deed of Assignment is a legal document used to transfer the ownership, title, rights, or obligations of property from one person (Vendor) to another (Purchaser). A Deed of Assignment is a registrable document that must be stamped and registered with the relevant authority. The Deed of Assignment may be prepared by the Purchaser's Solicitor and reviewed by the Vendor or vice-versa and be signed by both parties with their witnesses.
  • Payment of outstanding sum: - At this stage, all agreed outstanding sum or maybe balance by the Purchaser shall be paid.
  • Transfer of relevant documents: - The Purchaser through his solicitor shall request for all relevant documents, such as previous deed of assignment, land survey, receipt and so on, relating to the title of the property from the Vendor.
  • Closing: - At this stage, execution of the Deed of Assignment is done by both the vendor and the purchaser with their witnesses. The purchaser then takes full possession and ownership of the property.
  • REGISTRATION STAGE: -

Upon the transfer of the property by the vendor to the purchaser, by the provisions of the Land Use Act, the consent of the governor of the state in which the land/property sold is situated must be obtained and the purchaser must register the property with the government to complete the transactions.

To register a deed of assignment in Lagos, Nigeria, you need to follow the steps outlined below:

  • Obtain the necessary documents: You will need the following documents to register a Deed of Assignment:
    • Original Deed of Assignment: This is the title document with Governor's consent that transfers the ownership of the property from the assignor (Vendor) to the assignee (Purchaser).
    • Tax Payer Identification: You will need to provide evidence of being a registered tax payer before you can register a property on your name in Lagos State. Both the named Assignee and Assignor are subject to payment of personal income tax before a property can be registered.
    • Certified True Copies of the property's title documents: This includes the Certificate of Occupancy (C of O), Deed of Assignment, Registered survey plan or any other relevant document proving the ownership of the property.
  • Payment of fees: You will need to pay the required registration fees at the Lands Registry. The fees may vary depending on the value of the property.
  • Payment of Stamp Duties: You will need to pay stamp duties on the Deed of Assignment. The stamp duties are typically a percentage of the property's value and are payable at the Stamp Duties Office.

Registration of the deed is required to ensure compliance with pertinent statutes and to defend the legal validity of the purchaser's right to the property.

DOCUMENTS RELEVANT FOR BUYING A HOUSE IN LAGOS

When buying a house in Lagos, there are several important documents you should consider obtaining and reviewing. While the specific requirements may vary depending on the transaction and parties involved, here are some documents that are typically relevant in the house-buying process:

  • Approved Survey Plan: This is the document that outlines the boundaries and measurements of the property. It will also reveal whether the land is under any government acquisition or not.
  • Deed of Assignment: The Deed of Assignment is a legal document used to transfer the ownership and title of property, rights, or obligations from one person (Vendor) to another (Purchaser). It helps the Purchaser to know the root of title to the property to be purchased.
  • Letter of Land Allocation: Allocation Letter is also a vital property document, especially when dealing with property located at government schemes such as Government Reserved Areas (GRA). This Letter of Allocation is relevant to proof and process title to the property in such areas.
  • Certificate of Occupancy (C of O): The Certificate of Occupancy, or C of O, is the document delivered to the owner of a land by the government confirming the ownership and interest of the owner in that land.
  • Governor's Consent:Under the Land Use Act of 1978, approval of the governor of a state is required in respect of any transaction involving the transfer or conveying of any property interest from one person to another. Therefore, governor's consent is not a document on its own but an approval to the transfer of a property interest from one person to another.
  • Letter of Administration/ Letter of Probate: This is a legal document that authorizes an individual or a group of individuals (known as Administrators or Executors) to manage the estate of a deceased person who died without a valid will. Note that, any documents directly owned by a deceased person in respect of his or her property before death, becomes invalidated after his or her death to convey title in the said property. The grant of letter of administration or probate shall become the valid title document upon which the estate of the deceased person can be transferred to a Purchaser legally. The legal capacity of the named Executor to sign the document transferring the interest in the deceased person's property is called Assent.
  • Power of Attorney: If the property is being sold by someone other than the registered owner, such as an attorney or family member, obtain a copy of the Power of Attorney document authorizing the sale.
  • Building Approval: Check if the property has a valid building approval from the appropriate government agency. This ensures that the construction complies with relevant regulations and standards.
  • Receipts of Payment: Request receipts or proof of payment for any previous transactions related to the property, such as land purchase or development fees.

CONCLUSION

In brevity, it is crucial to engage the service of a lawyer abreast in property transaction when planning to buy a house in Lagos, Nigeria. It is the lawyer that will be able to ascertain if the transaction is a good one or not having reviewed all necessary documents pertaining to the property transaction and more. Statutorily, it is only a lawyer that can draft the Deed of Assignment conveying the title of the property to the Purchaser.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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