When An Estate Developer Fails To Allocate Your Property

Here’s what to do if and when an estate developer defaults on a property acquisition contract.

To default means the failure to fulfill an obligation. When you buy a property, this can be a piece of land or an offplan house, a developer enters an agreement with you to fulfill certain obligations. This includes:

• To allocate a piece of land measuring a particular size to you or house after you’ve fulfilled your own obligation for owing such property, which includes paying the full cost of the property, documentation fees (Deed of assignment and survey) and sometimes development levy.
• To refund or replace such property with another one without any further cost to you should issues arise about the property in the future.

Now if you’ve done your part and the developer is yet to do their part either by allocating your property or coming to some sort of agreement with you, maybe to move you to another of their estate or refund your money, and you’ve been in contact with them for a while and they just keep pushing you around or worse, not responsive, below are 5 steps to take to handle the situation.

Step 1: Do not panic

Try to stay calm. This is important because when you panic, you rush to get a lawyer or start threatening the company, or even worse, arrest your Realtor. And usually these steps just makes you spend more money without any guarantee of getting the result you want as soon as you want it.

So first stay calm and try to understand what the problem is. If you used a Realtor when you bought such property, reach out to them and work with them to try to get answers. Let the company know you are not trying to cause trouble and you understand this may not be their fault, but you just want them to level with you. So from there you can start to come to some understanding of how to move forward to get the value of your money back.

The major benefit of using a Realtor for your Real estate transactions, especially if you don’t live in Nigeria, is that you have someone on ground to check things out and follow things up for you when necessary. Also in situations like this, while a company might not respond to you, they may respond to your Realtor for a few reasons. First because the Realtor is on ground and can visit their office and cause trouble, but especially because Realtors usually have a long standing working relationship with estate developers, and if they misbehave word can spread fast among Realtors and that means losing a network of marketers to sell their properties.

Step 2: Negotiate

We recommend you negotiate. Once you understand what the problem is, ask them what options they have for investors now that things are the way they are. What is the solution? What is the way forward? You know, we can point fingers all we want. But once it has happened, the only thing you should be interested in is how you get the value of your money back.

So once you have the options decide what is best for you. Don’t be quick to ask for a refund especially if you’ve invested this money for a few years with them. The value of the money won’t be the same even if they refund you in full. I mean 5 million in 2020 and 5 million in 2025 doesn’t have the same value. And let’s be honest, no developer will refund you with interest. Best they can do is refund the full money you invested.

The best thing to do is to let them relocate you to another property they own, if that option is available. But make sure that this property is worth the same value as the one you’ve lost. And if not, see if they have another estate you’d prefer instead, it’s a negotiation. Don’t be afraid to negotiate. They are trying to also resolve the matter, at least any decent business person wants to resolve a matter like this as fast and as peaceful as possible.

The goal of your negotiation is to make sure that you are not losing in any way and the plans you had for making that investment can still be achieved with the new location. Keep in mind that sometimes you might need to add extra money if the location they have to relocate you to is of more value than what your property would have been worth by now.

Now this is also why we recommend working with estate developers that have been in the business for a while and have good track record. They usually have the resources including a number of quality estates options to resolve issues like this.

However if they insist you pay some money to be relocated and you just don’t have it or you have lost trust in them and just want to collect your money and money on, then that’s fine too. Although for a refund know that most companies won’t be able to or willing to make a one bulk full refund. They are likely to put you on a payment plan.

Step 3: Be Understanding and Reasonable with your Demands

This is very important. Some investors become very rude and insulting, and we think it’s not necessary if the company is responsive and not trying to hide from their obligation to you. There’s no need to be rude, there’s no need to be insulting, there’s no need to say, oh, I’m the one that is right, you know, you either do this or do this. Be understanding and reasonable with your demands, and we recommend this for a few reasons. First, is because we know that in any business a vendor sometimes experiences setback for no fault of theirs. So it’s being human to give them some grace; that is when they are responsive and committed to a beneficial resolution.

For example, if you’re asking for a refund, if that’s the option you go for, please know that it is unreasonable to insist that a company to refund you your money right away. They are currently in the middle of a crisis and likely have other investors to pay to too, and therefore would likely need some time to make a full refund.

4. Do not try to intimidate your Realtor

A Realtor is usually not a staff of any of the estate developers whose properties they market. We are middle men. We are property agents. Anywhere you live in the world you understand the role of an agent and their purpose when buying a property; they help you handle the stress of searching for a safe property that meet your needs and make things easier for you. However you are not really doing business with them. You are doing business with the developer. And you pay to the developer.

A Realtor should help you in situations like this; they should represent your interest. And follow up with the issue until it is resolved. However, not all Realtors are responsible or committed to their clients. And if unfortunately your Realtor is one of such, ignore them and try to fight for your interest yourself. Arresting them won’t get you your money back. You will only waste money on police and or lawyer.

Remember you didn’t pay your money to the Realtor. So you don’t have a case with them. Yes they introduced the company to you but it is still your responsibility to do your due diligence on any property before buying. And the decision to buy was made by you and not forced on you by the Realtor.

The worse is coming online to drag a Realtor that is working with you in trying to get a Resolution, calling them scammers. It’s time to come together for one purpose not a time to be divided. So instead of arresting your Realtor, get a lawyer to write the company if they are not responding to you. The lawyer can visit their office too to speak with the MD one on one. But don’t file a case yet.

Step 5: Go public!

You may be wondering why we are not recommending getting a lawyer and filing a case or getting the police involved right away. It is because we don’t want you to lose more money trying to get your money back or the worth of your money back.

When you get the Police involved they will ask for money before proceeding and aside that the police usually take ten percent of any money they help you recover.
Getting a lawyer is the same thing. You spend money. And when they file a case for you, you have to pay them each time they appear in court. And the court process in Nigeria usually takes a while for a judge to sit on a case. So you may not get that money for a long time and yet you will have to keep paying the lawyer to appear in court.

So if eventually you do that, get the police involved or get a lawyer and file a case, we want it to be the last resort for you, when all other avenues of getting your money back have failed.

The most effective and least expensive way of getting the attention of an estate developer or even any company for that matter that have refused to get back to you, or follow up with you regarding replacing your property is to threaten to go public. We mean do a video where you call them out, then pay a major social media news outlet like the popular InstaBlog to publicize that video. Of Course before you do that first threaten them with going public. They are very likely to respond to you and will take action to resolve the matter quickly.

We’re very sorry if you’re currently in this situation. At TrueMandate Realty we carefully pick the estate developers we partner with and the properties we recommend to prevent issues like this, and if ever they happen we work with our clients to ensure they get their property’s worth back. So wouldn’t you rather work with us in acquiring your next property? Kindly use any of the numbers on our website to call or send us a Whatsapp message and we’ll be glad to represent your interests well and you never have to worry about what to do when an estate developer fails to allocate your property or refund your money.