Reasons Land Banking Is The Best Real Estate Investment

Here at TrueMandate Realty Ltd we always recommend that our investors prioritize Land banking especially if you don’t live in Nigeria. And in this article we want to share with you why we recommend this, and even though we recommend also that you diversify your property portfolio, we definitely are recommending that you prioritize land banking, and for several reasons.

1. Land Banking is the Most Relaxed form of Real estate investment

If you have some money you want to invest that you wish to be getting returns on but you don’t want to have to stress yourself doing anything to get that return on investment, then Land banking is best for you. It is relaxed and low risk; although it can also be high risk because if you don’t do the necessary research that you’re supposed to do before buying a land or you just go buy a land because you see it being advertised that it is cheap with lots of promises, or you don’t use a trusted Real estate broker, it could actually be high risk investment because developers can come and go especially the new ones springing up, they can disappear as fast as they come.

However if you’re working with a brokerage firm they have been in the business for a long time and therefore they know the developers that are trustworthy, they can recommend an estate with safe land to invest in that will also enable you to maximize return on investment. If you follow this tip you’ll find land banking to be very low risk.

2. The Most affordable form of Real estate investment

Land banking is the most affordable form of Real estate investment that you can be involved in and get good return on your investment. This is because if you want to do Short lets in an attempt to get rental income, you’ll have to spend more money to get an apartment or a house, and at the moment it will cost you over N50million to get even a one bedroom apartment in good areas where short lets will thrive, and after you do you then worry about getting back that bulk of money you’ve invested, which usually could take a decade or more to accumulate. Whereas for land banking even just N20million can get you 5 plots of C of O land in a place like Abuja, one of such estates is SunCity Estate Abuja a plot sells for N4million only.

3. Allows you to Maximize return on your investment within a short period of time

This is possible when you buy lands during prelaunch sales. Prelaunch sale is the price offer made to early investors into a new estate before the official price takes effect. Developers usually do prelaunch offers to create some buzz around a new estate, make some quick sales and recoup some of the money invested into such estate before introducing the official price.

Prelaunch offer gives you a plot in the estate at the lowest price possible for the developer. These offers usually only last for a few weeks. If you buy at that discounted price, you can make good return on investment within only a few weeks.

Over the years we’ve had many investors take advantage of prelaunch offers to make some really serious returns. For example we had a number of clients who bought an acre of land when SunCity estate Abuja was on prelaunch for N2.5million a plot and after a few weeks the official price of N4million took effect. That’s N1.5m returns per plot. And multiply that by 6 and that’s N9million returns on a N15million investment within a few weeks. Most recently is CityView Estate Abuja going from the prelaunch price of N4million per plot to N6.5million official price. That’s N2.5m return per plot.

Lank banking doesn’t always have to be a long term investment

You can make good returns within a few years of banking a land and decide to sell. Although we recommend that when you do land banking you don’t rush to sell. And the reason is because the best lands for land banking are lands that have proposed infrastructural projects in the area that will greatly increase prices of lands in that area within a few years. So you buy the land and wait. The best time to sell such lands are after those projects have been delivered, that way you are able to maximize return on investment.

However not everyone can wait that long. So this is why we also recommend that when buying land for land banking you buy multiple plots. For example you do an Acre which is 6 plots of land, if you do that then you can sell off 3 plots say after 2 or 3 years, make some short term return on investment, and then leave the other 3 plots to capitalize on the future return on investment for that particular property.

If you want to do land banking short term, say keep the land for 2 years, then make sure to invest in an estate that’s in a developed area so that the land can appreciate quicker. But keep in mind that such lands are usually more expensive. You will need more money to buy just a plot. And the profit you can make on such investment when compared to when you buy affordable lands in bulk is low.

For example you buy a plot of land for N12million and bank it. And in 2 years it’s worth N22million. Versus you buy a plot of land for N4m and you buy 3 plots. In 2 years each plot is worth N10m. That’s N6million, multiply by 3 that’s N18million. So you spent same amount and one gives you a return of N10million and the other a return of N18million.

Having said that we must also say that although it’s not very common, we have seen cases where buying a plot of land for more money paid better return than buying the less expensive ones in up and coming areas. A case in point is when we sold plots in Meridian Boulevard estate Ajah. Of course Ajah is a developed area so it didn’t come cheap and therefore this particular client was only able to afford a 300sqm for N10.5million, that was in January 2021. And in January 2025 plots finally closed for sale in the estate at N55million for 300sqm. That’s a return of N44.5m in 4 years. We don’t know any client that invested N10.5million in affordable lands in 2021 that has now made N44.5million whether on a plot or multiple plots. The reason this estate did so well was because one, it was in a developed area. Two, the developers started offering offplan houses right away and delivering them. So by January 2025, people already live in the estate.

Recap: How To Do Land banking Right

1. Find a property that’s on prelaunch so that you buy at the lowest price possible.
2. Make sure that there’s something going for that area, don’t just buy into any estate for land banking. We’re trying to buy into that property that will give good return within a short time, and also in the near future. So look for a property that is in an area that has something promised that will greatly improve the lives of the people in that area, like for SunCity there’s a proposed major road that’s already being worked on that’s going to link the area to the city. Or an estate in a developed area with affordable plots for that area, and because it’s within a developed area different projects will come up quickly to get the land appreciating quickly.
   3. Buy in Bulk, some for short term return and some for long term.
   4. Use your discernment. Sometimes buying a plot for much more money can earn you more returns than buying for lesser where you can buy in bulk. This is also why you need us. We can guide you on what’s best to do at a given time.

The Best Lands for Land Banking today

For now, the two options we recommend for land banking are:

• SunCity Estate Abuja (Best for long term investment)
• CityView Estate Abuja (in a developing area, good for short and long term investment)

Both estates have payment plan for up to 24 months.