Make Money Building Private Student Hostels in Nigeria
Are you interested in how to build a student hostel for business? What is the average cost of building a hostel in Nigeria?
One of the most lucrative real estate business in Nigeria is constructing halls of residence for students.
Over the years, under-funding of the educational sectors has culminated in deficit and decay in infrastructure.
Apart from labs, books, equipment etc, hostels are now becoming limited in meeting the housing needs of the student population which increases yearly.
In Nigeria, it is worth noting that only a few number of schools have enough accommodation facilities for all their students. This issue is not peculiar to Nigeria alone as some other universities around the world give their students options of staying on campus or in private hostels.
Consequently, shortage of housing for students has created great investment opportunities for entrepreneurs in Nigeria. Building student hostels is in hot demand as some students don’t mind spending any amount to get a decent and comfortable private accommodation in areas close to their schools (universities, polytechnic and colleges of education). Note that investing in student housing is a sure way to get high returns on your investment.
Do you have a property near a university, polytechnic or college? Is there an opportunity to buy a property close to a school? You may consider making it into an off campus student housing. This real estate business will guarantee you decent flow of wealth annually.
When you rent out your property to students, there are certain challenges you should expect. Since your tenants are young and brash, they may need to be regulated. Some students are noisy and rough and so you may have to carry out maintenance more than the usual times.
Being very sociable, you may discover that the student occupying your property has another student ‘squatter’ who may also bring his own friend along too. All in this same room!
Sometimes when there is a break in their academic programme such as during holidays or strike, your hostel may become too vacant that security breech may be an headache. In addition some students may develop negative relationship with neighbours.
Understand that your occupants would not be housed there forever, your rental term should not exceed a year. You will not lose money during vacation if you collect rent annually. Collecting security deposit will caution unruly students against damages to your property.
Clear guidelines and instructions on payment, conduct and responsibilities should be given to them before a student moves in. Please get valid information about their parents/guardian and departments. You may need an experienced and disciplined manager who is resident there or have your caretaker visit there once in a while.
If you maintain a reputation for quality and discipline and your facility will generally attract the best and at a premium.
Advantages of Investing In Student Housing
==> High Rent: Irrespective of the location, student hostels command great rents because of the traffic of students especially when a new session just begins. Demand is often higher than supply driving up rent for the property.
==> Quick Returns: Students rent hostels on a yearly basis. You are guaranteed of occupants year in year out. This enable you recover your investments in a short time. You can save towards building a new hostel or expanding the existing one.
==> No Rent Owed: Contract with student occupants is usually on a yearly basis. New occupants have to pay before moving in. Students’ stay is short so you can easily increase rent gradually.
Popular Student Hostel Designs
Below are some of the investment options that a real estate investor can implement in the business of building student hostels.
==> Single rooms facing each other (Face-Me-I-Face-You)
==> Room and Parlour Converted
==> Single room ensuite (Self-Con)
==> A bedroom flat
Cost of Building a Student Hostel in Nigeria
This should only be taken as a guide:
Quotation for 16-units of self-contained hostel (conservative rates)
6000 blocks at 120 = N720,000
Sand for setting 5 trucks = N75,000
Granite 50 tonnes =N220,000
Rods 12mm 1tonne = N120,000
Stirrups 40 length at 500=N20,000
Laterite 40 trucks, @ 7000=N280,000
Dangote Cement 350 bags at 1,200 = N420,000
Woods for lintel, 50 length at 800= N40,000
Nails = N15,000
Labour costs = N550,000
Total is N3,960,000
Other items to buy for the interior are stated below (read carefully).
1. Metal doors(for entrance) – 16pieces
2. Wooden doors(for kitchen and toilet) – 2 x 16rooms = 32pieces
3. Floor tiles for rooms(this is important if you want students to pay good cash for the hostel)
4. Floor tiles for kitchen and toilet
5. Wall tiles for kitchen and toilet.
6. Wash hand basin for kitchen – 16pcs
7. WC set for toilet – 16pcs
8. Buglary proof for windows – 48pcs
9. Windows – 48pcs
10. Paint for the interior and exterior
11. Wiring and Electrical switches
12. Generation change over switch – 16pieces (this is very important to avoid students from tampering with the wiring system)
13. Main gate: between 70k and 120k depending on choice and quality
14. Borehole water facility(if you can’t afford it, you can drill a deep well and install pumping machine)
15. At least two big water tanks for the students
Most students in higher institutions are from average/low income households. This is why small housing apartments are more popular among students. Don’t waste your money building hostels that most students cannot afford.
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