Building My House: Should I Build Just For Myself or Include 1 or 2 Rental Flats?


I have started the process of building my house. It's a first for me -- no experience whatsoever, especially with dealing with people who can fleece one in very creative ways.

Here's what is and what I know so far:

  1. The land is 20 mins after Lagos Business School. There's Greensprings Schools very close to it. It is also close to Lufasi Park, shoprite, a local market and a beach. It is right beside Adiva Planfields in a very nice neighbourhood -- excellent road, amenities and everyone is building luxury-type houses in the estate. In summary, I am very happy with the infrastructure and general neighbourhood.
  2. I don't see myself relocating there soon. Everywhere I currently do business is very far from there - at least one hour far.
  3. I want to start building now.
  4. I have engaged a company (more like a person who has a growing company) for architectural, mechanical, structural and electrical design. After negotiation, he's charging N430,500. Looked very high compared to the N240,000 the estate recommended architect quoted. But I was told that for that type of quote, he would just give me an existing design. Not an original custom made design with many stages of review with us (my wife and me).
  5. The starting point is the building design (mentioned above). Then we would have to apply for building approval from Lagos state government. That it's a very messy process. Some people just ignore it and do some form of retrogressive bribing. Some people get someone close to the govt agency and have the person handle all the filing and stress, cover the person's fees and PR expenses. Was advised to use the second route and budget about N200,000 for the main expenses and some more for the PR expenses.
  6. The approved building design will then be submitted to the estate and the Lagos state government.
  7. Then start saving towards the first construction milestone - foundation. That my land is of a type that requires raft foundation. So I should be expecting to spend 2x to 3x what a typical foundation would cost.
  8. I am still deliberating what type of house to build on the half plot (300sqm) land.

And that deliberation is the reason for this blog post.

I am largely considering two options:
  1. Build a 4 bedroom one storey building. No tenant. Just us.
  2. Build a duplex - one side for us and the other side for a tenant. 
The factors I am weighing that keep me indecisive are:
  1. Complete privacy, access and noise control. I like a very quiet house -- no noise and no people constantly going in and out.
  2. Making side rental income would be nice. Considering that I would be spending a lot on building the house.
  3. Managing tenants can be difficult, especially if one gets a hellish one.
  4. Being able to rent out the two units can be a good strategy if moving there is not going to be an economically sound decision. Maybe, we can use the rental income to pay for a good flat in a more desirable location.
  5. I am a bit too attached since it's my first and quite significant in cost
So what would you do if you were me?

My parents are for having even 2 tenant flats. That the rental income will make sense as we grow old and that in case we travel for a long period, the house won't be vacant and falling apart. Don't know how 3 apartments would fit into that half plot, maybe via having 2 storey building on it. Anyway, I get their general point which is valid also for having just one tenant flat.

I look forward to hearing your opinions. Thanks.


  1. Congrats Michael. I have been reading your blogpost for a while now and i am really happy for your progress. Keep soaring.

    I am for rental income and would support having another duplex beside yours. I prefer the duplex arrangement because if you get tired of renting it, you can sell the duplex en bloc and not as flats. Since you like your privacy, you may need to come up with creative ways to demarcate the 2 duplexes.
    Wishing you the best as you embark on this exciting journey in real estate. God bless

  2. I will suggest you build two to four flats apart from your own, even if you get tired of renting it, you can still sell it.
    For privacy sake,make provisions for one duplex for yourself, if it is in this same place with the one you want to rent out, kindly put a fence as demarcation.
    Please don't live in the same compound with tenant
    All the best.

  3. Investing for cash flow is the best option I see here. I would suggest you build the duplex and opt in for a semi detached that would accommodate both you and the tenant as well. As this is your first, many landlords and intending landlords should also know the place of integrity and not condescend to building a sub standrd building for the tenant. It would cost you more in the long run. That said, congratulations on your latest achievement.


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