Property developer: selling what does not exist yet

A buyer signs for an apartment they cannot visit, in a building that is not built, on the strength of a plan and a scale model. They will pay money for months before seeing a wall. Everything a developer does — the land they secure, the permits they obtain, the way they call for funds, the information they send — serves to make that situation bearable. When the work is done badly, it is the buyer who carries the risk.

A project owner, not an intermediary

This is the first distinction to draw, because the two trades are commonly confused.

A real estate agency is an intermediary: it brings a seller and a buyer together, and the property is not its own. A developer is a project owner: they conceive an operation, acquire or control land, commission the studies, have the works built, then market units that belong to them. They carry the scheme, its financing and a large share of its risk.

The difference shows in the company's structure. There is typically a programme directorate held by a technical profile, site management present on the ground, and a sales function following buyers from reservation to handover. These are three different trades the same company must hold together at once.

It shows in the calendar too: an agency works in weeks, a developer in years.

It all starts with the land

No scheme is worth more than the land it sits on, and that is where most of the risk is decided.

The preliminary work consists in establishing what can really be done with the plot: who holds rights over it, which ones, since when, on what evidence; whether occupants or uses coexist; what the planning rules allow there; which easements or technical constraints bear on it; which formalities will have to be completed with the competent authority.

None of that is settled with a photocopy. The United Nations Human Settlements Programme points out that across developing countries the overwhelming majority of landholdings are neither documented, administered nor protected, and that land administration systems cope poorly with the complexity of overlapping rights and claims on the same land. Depending on the country, proof of a right may take very different forms — a title, a certificate, an entry in a register, a deed received by a public officer, customary recognition — and none of those forms is universal.

A developer can assemble documents, have a surveyor draw up a plan, have a lawyer analyse the position and file the required applications. What they cannot do alone is certify that a plot is free of competing rights: that verification belongs to the authorities and qualified professionals of the country concerned.

Structuring: what must be settled before the first stone

Between the idea and the site there is an invisible phase that decides everything.

A programme has to be settled — how many homes, of what size, for what use and which buyers — the technical studies commissioned, the contractors chosen, a budget and a calendar established, the administrative permits obtained, and the financing secured.

The legal shape of the operation matters as much as its technical side. In the seventeen member States of the Organisation for the Harmonisation of Business Law in Africa, questions of company law, security granted to financiers, debt recovery and arbitration fall under directly applicable uniform acts, whose interpretation is ensured by the Common Court of Justice and Arbitration. That law applies in its member States, and nowhere else on the continent: it in no way removes the need to examine national planning, construction and property-sale law, which remains particular to each country.

One point deserves saying plainly: launching sales before the land and the permits are settled amounts to having buyers finance a risk they cannot measure.

Building is not laying the blocks yourself

A developer does not usually lay the blocks. They have the works built, which is another trade: dividing the works into packages, contracting with firms, coordinating trades that get in each other's way, controlling quality, holding a calendar and arbitrating continuously between cost, time and finish.

Site management is the part of the trade where decisions are taken in hours. A delivery that does not arrive, bad weather, a failing contractor, a technical defect: each of those events ripples through the programme and, in the end, through the date announced to buyers.

It is also the part that can be observed. An organised site visit, with safety equipment, shows in ten minutes what no brochure can demonstrate: actual progress.

Selling off plan: making the gap bearable

Marketing a property that does not yet exist means giving the buyer enough to decide without being able to check for themselves.

That runs through documents: plans of the unit, a specification of what will and will not be delivered, its exact position within the scheme, finishes and materials, price, indicative calendar, and the contract itself. A precise specification is worth more than a flattering computer rendering — it is the specification that will be read again on handover day.

The legal regimes governing the sale of a building yet to be constructed, the protections offered to buyers, the guarantees required and the formalities applicable vary widely from country to country. Some systems regulate such sales strictly; others do not. A buyer therefore has every interest in having their contract read by a qualified professional in the country concerned before signing, and a serious developer takes no offence at it.

Staged payments and what they presuppose

Paying for a property under construction is rarely done in one go. Staging is the central mechanism of the relationship, and the one that deserves most attention.

The defensible principle is simple: each call for funds matches a stage genuinely reached, and that stage is observed before it is invoiced — ideally by a third party independent of the developer. Conversely, a call for funds made in advance transfers to the buyer a cash-flow risk that is not theirs.

The amounts, the stages, the existence of a reservation deposit, the conditions for returning it and the associated guarantees depend on the applicable law and on the contract. No percentage is a norm, African or international, and a developer who presents their own payment schedule as a general rule says a good deal about their method.

A buyer should always know whom they are paying, into which account, for what purpose, against what receipt, and what happens if they stop. The Financial Action Task Force also published on 26 July 2022 guidance for a risk-based approach in the real estate sector, insisting on customer identification and on access to information about the beneficial owners of a transaction. Those obligations, however, apply only to the extent that each country has designated the professionals concerned as covered.

Informing through the months when nothing is visible

Between signature and handover stretches a period in which the buyer has nothing to look at. That is where trust is lost or won.

Regular information is a simple and effective professional practice: a dated progress note, photographs of the site, announcement of the stages reached, and above all communication of difficulties when they arise rather than when they become visible.

Digital tools help — a buyer portal, document delivery, a visit diary, electronic signature where the applicable law recognises it. The UNCITRAL Model Law on Electronic Signatures, adopted on 5 July 2001, offers States a framework built on functional equivalence and technological neutrality; but a model law is not a treaty, it holds only where a State has enacted it, and some property instruments remain subject to particular formalities in many systems.

Artificial intelligence can help draft a specification, sort enquiries or prepare a progress note. It observes no progress, verifies no right over land and guarantees no price.

Delay, the subject that cannot be dodged

A property scheme runs late more often than it does not. The subject should not be treated as a theoretical hypothesis.

What separates operators is not the absence of delay but what has been provided for it: a clear contractual date, suspension causes listed exhaustively rather than a catch-all clause, immediate notice, and consequences dealt with in the contract. Compensation regimes and available remedies depend on the applicable law and on what the parties signed.

For a buyer, the question to ask before signing is not "will you deliver on time?" but "what does the contract provide if you do not?".

Handover, defects and the life that follows

Handing over the keys is not the end of the relationship.

Handover is a technical act: what has been built is compared with what was promised in the specification, and defects are recorded. A developer who runs that stage seriously, item by item, with a period to put things right, makes life easier for themselves as much as they reassure the buyer.

Then come the guarantees applicable to construction, whose scope and duration depend entirely on national law and on the contract, and then the collective life of the building: common parts, service charges, organisation of owners or occupiers under whichever regime applies. A scheme delivered without that organisation prepared deteriorates quickly.

What a developer does not guarantee

A developer does not guarantee that an investment will be profitable, that a property will gain value, that a district will develop as announced, or that rental income will be steady. Property prices can rise and fall, costs exist, income can be irregular and regulation changes: every project is judged on its own, and a projection is not a promise.

Nor do they guarantee, on their word alone, that a plot is free of competing rights, that a permit will be granted or maintained, or that a document produced is genuine. Those verifications belong to the competent authorities and qualified professionals — notary, lawyer, surveyor, land service, bank — according to how each country is organised.

What they do commit to can be checked: land examined before launch, permits obtained, a scheme described precisely, a site that can be visited, calls for funds tied to observed progress, regular information, a handover carried out with the buyer present, and defects dealt with.

That is also what makes a development company credible online: a stable identity and contact details, schemes presented with their real state of progress, accessible specifications, information forms, appointment booking for site visits, clean documents and invoices. Here as elsewhere, reputation is built on what has been delivered, not on what was announced.

Finally, this article describes a trade; it replaces neither legal advice nor financial analysis. The rules mentioned vary from country to country, and any real project is examined on the documents, with the qualified professionals where the scheme is being built.