Effect of Land Pollution on the Real Estate Industry.

Some years ago, a land in Sangotedo Eti-Osa, Lekki in Lagos State served as a major illegal dumpsite, it was a prime property by the expressway. The stench from this property was unbearable, even with your car air-conditioning fully on, it still penetrates and would fill your car with a pungent smell. This was an eyesore, the fact that it was a prime property was lost on all.

Around 2013, one of the Pentecostal churches that had a plot beside that land saw the need for expansion and sort to buy the same. I was privy to the information on the land sale, but for the sake of confidentiality, I wouldn’t disclose the actual amount the land was purchased for. However, what I can say is, it was sold twenty percent (20%) less than its actual value. Yes, I said twenty percent!

This issue is prevalent in the metropolitan or cosmopolitan environment of developing countries, like Lagos Nigeria, hence I see the need to say a few words on the effect of land pollution on the real estate industry.

1. Reduction in Value of property: Purchasers always seek for reasons to beat down prices of landed properties during the negotiation stage.  Refuse on a landed property presents estate valuers and purchasers with a leverage. This issue is peculiar to undeveloped land either left for speculation purposes or for the unavailability of funds for development. The case narrated above is typical, hence I strongly advise that if you have a property you abandoned for a while, do what you can to fence and possible gate the land, this marks a territory and makes trespassing or abuse difficult which in turn guarantees your land to appreciates in value accordingly.
2. Loss of Appeal to Purchasers: For properties in the market with dumpsite issues, getting prospective buyers to make offers would be difficult, as they would rather seek alternatives than buying a land used as a dumpsite. In the scenario above, the land matched the church’s need and rightly positioned hence the offer to buy the land.
3. Development Issues: As development commences on a dumpsite, cost significantly increases; the refuse must be cleared and conveyed to an approved dumpsite, soil must be replaced as the refuse clearing mines soil from the land.

If a property is erected on the land, there will be issues of possible water pollution, hence water treatment systems must be installed which is an added expense. Workability of the soil during foundation stage of construction also presents a challenge.

On the other hand, for purchasers and smart investors; when you see that dumpsite in a prime location, verify that it is not a government acquired site, once it’s not and you have the means; make an offer!

As stated in my last article an investor needs to think ahead and be a visionary in approach to land transactions. You need to see beyond now when investing in a certain type of property. Please note, this is not to endorse the purchase of dumpsites, because it might be a tricky investment.

For further assistance or consultation on this article or other issues, feel free to contact me. Email ibejulekkilawyer@gmail.com or Call 08034869295.