Buying a piece of land? Look out for these extra expenses.
Legal fees
This is the money clients pays to a legal practitioner after their services. All legal matters related to a property must be handled by a property lawyer, from negotiations through title verifications and sales transaction to disputes if and when they arise.
Simply put, the duty of a lawyer in a purchase transaction is to ensure that the interest of his client is protected to the latter. The computation of legal fees may differ from transaction to transaction although in practice it is fixed at five (5) percent of the value of the property.
Agency fee
Agents normally serve either of both parties, the buyer or the seller. When representing the buyer, they are charged with scouting and finding a property that suits the client’s brief. When an agent is representing the seller, they are mainly charged with advertising and finding a buyer for the seller’s property. In both cases, the agent may close the deal on behalf of their client if they are so authorized.
Consequently, the agent is entitled to a fee for their services. Agency fee is usually fixed at five percent of the value of the property although it is often times negotiated downwards by the clients.
Bush entry
This is a non-refundable preliminary fee paid by the buyer to the seller in demonstration of his interest in the property. Bush entry does not form part of the agreed price for the property. The bush entry could be paid to either the seller or his agent, depending on their terms of operation. In most states in Nigeria, the bush entry fee for a plot of land is hundred thousand and is seldom negotiated.
Fencing Cost.
Fencing involves building structures, covers or setting a constructed barrier for the purpose of avoiding unauthorized access to a property while showing a well-defined boundary of the property in order to safeguard a property. It goes without saying that this attracts some cost which could be influenced by the boundary status of neighboring properties.
The importance of fencing cannot be over emphasized. Fencing adds value to the property as a fully fenced property may sell at a faster and higher rate than an unfenced property.
When constructing a fence, it is advisable to set back 2 to 8 inches from sidewalks and property lines.
Summary
Although these extra costs may seem a bother to clients especially when they barely raised the cost of the property, it is important to settle these accordingly in order to enjoy a smooth transition and eventually ownership of the property. Fortunately, none of these rates are cast on stone. Negotiate your way through a successful transaction if there be a need.
