Real Estate professional practice in Nigeria, challenges, recommendations -ESV Ngozi Ohaeto

Real Estate means real tangible property. According to Jacobus (1994), it is land, and the improvement made on it, and the right to use the land and the improvement thereon. Also, Sirota (2004) defined real Estate as land and all-natural and man-made improvements attached to it.
Jide Babatunde (2012) explained Agency as a relationship where one party who is usually the agent is empowered to enter a binding transaction that will have a legal impact on another party called principal. For example, entering a contract to sell or buy in his name or on his behalf. This means that when an agent deals with a third party, they act on behalf of and under the control of the principal. Therefore, an Estate agent is an intermediary/middleman who receives a commission for facilitating the sale of real estate. An agent can also facilitate a letting or lease of a property.
Types of Estate Agency in Nigeria Market.
Sole Agency: This is the type of agency where an Estate Surveyor and valuer are retained exclusively by the client/property owner (Principal) to sell or let his property. This means no other agent is authorised to prospect the subject property for sale or lease.
Joint Agency: This is where the principal appoints two or more agents to sell or let his property at the same time. These two agents are usually informed of their appointments in this case and fees are shared in agreed proportion between the agents regardless of who found the buyer or tenant.
Multiple Agents: In this arrangement, the clients retain many agents to effect the sale or letting of the same property. This is mostly applied to large development, corporate development in various locations or during property slumps where required efforts to sell or let a property.
Professional Procedure for Agency Practice
One of the attributes of a good professional service provider is his capacity and ability to effectively carry out his assignment, duties and tasks by the set standards and laid down guidelines. Which standard one would wonder? Standard established by global best practices and international professional bodies. For example, the Nigerian Institution of Estate Surveyors and Valuers prescribed the Valuation standard in Nigeria as approved by the Estate Surveyors and Valuers Registration Board of Nigeria. Standards are derived from theories, theories are tested, and globally acceptable concepts are developed through the various stages of conception, hypothesis, experimentation, statistical and analytical tests and later globally accepted as facts and truths.
For Estate Agency to be practised with only minimum and pardonable errors, some fundamental principles must be observed in practice. Many Nigerian Estate agents hold the view that Estate Agency is a marketing concept, and some believe that it is a combination of law and marketing. But a critical look at the practice of Estate agency reveals that it is a legal, marketing and management concept. The Estate Surveyor and valuer in Nigeria recognise this fact as illustrated in one of their professional questions on property management “Agency ends where management begins- Discuss”. Many transactions in estate agency have failed because the practitioners do not know the legal, marketing and management theories that surround the subject. Therefore, it is safe to say that only the Estate Surveyor and Valuers are better trained and equipped to effectively practice Estate agency, this is because they possess the education, training and experience required for the practice. They are core professionals and are better organised to adhere to the international standards required.
The main players in the Nigerian Estate Agency Market
The Nigerian estate agency market is characterised by the proliferation of all manner of persons, and they have been categorized into 3 groups.
The Professional Estate Surveyors & Valuers: These are the trained professionals who are graduates of Estate Management and a member of the Nigerian Institution of Estate Surveyors and Valuers(NIESV) which was founded in 1965 and recognised by Act No.,24 of 1975; now known as E13 Law of the Federation of Nigeria 2004).
The membership of the institution can be attained through sitting for a professional examination, and a thesis writing and defence. One of the critical responsibilities of the institution is the continuous training of its members for optimum professional practice in their areas of professionalism.

The Graduates of other Disciplines: These are graduates of polytechnics and universities. They include lawyers, architects, engineers, builders, economists, accountants etc. Most of them operate under the banner of Estate Agents or “property consultants”. With the recent rise in the unemployment rate in Nigeria, many graduates in the mega towns and cities have taken up Estate Agent as a means of survival.

Illiterates / Semi-Illiterates: many of those that fall into this category have assumed the role of an Estate Agent. Many of them are school dropouts, retrenched workers, unsuccessful artisans and charlatans. These classes of people cover high-density properties, such as tenement buildings, properties in remote areas, and poor and unsanitary locations. Their operation is unregulated and informal with no known address or business registration. They often exploit their unsuspecting clients and make a lot of illegal financial collection from their clients such as registration fees, inspection fees, Etc. Sometimes they collect rent from multiple perspective tenants thereby defrauding them. The activities of this class of estate agents have often tarnished the good name of the profession and this calls for immediate regulation of the industry.

The Nigerian Institution of Estate Surveyors and Valuers has attempted to clean up and sanitising the industry through the creation of the NIESV Estate Agency Association of Nigeria (NEAAN) to teach and train interested individuals on how to practice Estate Agency professionally thereby having more licenced and professional realtors than quacks. This is a laudable step in the right direction and should be appreciated.
RECOMMENDATION
Engage more Registered Estate Surveyors and Valuers in real Estate-related transactions as they are better trained and equipped to professionally handle the assignment. Also, they are approved by law and are regulated through the Board and NIESV giving them the required credibility.
Estate Agents seeking credibility should register with the NIESV Estate Agency Association of Nigeria (NEAAN) to practice professionally.
The Institution should vigorously pursue the ultimate regulation of the estate agency market by sponsoring an all-encompassing bill in the National Assembly.
The institution will lead that chart for standardization of acceptable procedures, requirements, and other international standards of real estate practice. One such step is being licenced to practice en route through a professional examination as an estate agent in Nigeria. That way, citizens’ interests are protected.