All sources have been thoroughly verified for credibility. Furthermore, a local real estate expert has reviewed and approved the final article.
Yes, the analysis of Lagos' property market is included in our pack
Considering buying a nice property in Lagos? You're not alone!
Many people are captivated by Lagos' vibrant energy and dream of owning a modern apartment or a stylish villa in this city.
Is it financially viable, though? Are property prices increasing in Lagos? Is it expensive? Is it more profitable to buy in Victoria Island or Ikeja? And the taxes? What yields can I expect?
We've got it all sorted. No worries.
At TheAfricanvestor, we've done our homework and know this market well. As a matter of fact, we've put all our findings together in a pack. Get it now.
In the lines below, we will share some of this knowledge.
How is the real estate market in Lagos?
Is the property market thriving or struggling? We'll find the answers through data analysis.
Types of properties
In Lagos, Nigeria, you can buy apartments, townhouses, standalone houses, and commercial properties like shops and offices.
These properties are found across neighborhoods like Victoria Island, Lekki, Ikeja, and more.
The prices can range from affordable to high-end, depending on the area and property type.
Keep in mind factors like property size, number of bedrooms, and facilities available when looking for a suitable property to buy.
Buy or rent?
(If you're buying for yourself and not to rent out)
Whether you've already made Lagos your home or are contemplating it for the future, you might be wondering about the advantages of buying a property versus renting in this vibrant Nigerian city.
Without a doubt, it's better to buy if you want to build long-term wealth and take advantage of potential appreciation in the property value.
Actually, decisions become clearer with the property price-to-rent ratio in mind. It's a way to understand how many years of rental income you need to cover the property's current price.
According to Numbeo, the property price-to-rent ratio in Lagos is around 4.55, which is one of the lowest in the world.
It means that, on average, you would only need 5 years of rental payments to actually purchase a property. You plan on staying that long? Go for buying.
Property prices in Lagos
On average, according to the updated data from National Bureau of Statistics (NBS), purchasing a property in Lagos will cost you around $2,500 per square meter.
Of course, prices vary. An apartment in Lagos city center will likely have a different price per square meter than a seaside property. We actually give you a more detailed breakdown in our pack for buying property in Lagos and in Nigeria.
To help you understand better, it is 8 times less than the property prices in the center of New York.
However, housing prices in Lagos are slightly higher (2%) than in Dakar.
The most expensive neighbourhoods in Lagos are probably Ikoyi, Lekki, and Victoria Island, while the cheapest neighbourhoods are likely Ajegunle, Agege, and Bariga.
Trends
First and foremost, we have to acknowledge that Nigeria is, today, not a stable country. The last Fragile State Index that has been reported for this place is 97.2.
Don't overlook this while weighing the pros and cons of buying a property in Lagos.
Besides that, if we look at the IMF's GDP forecasts, Nigeria's economy is expected to soar by 13.8% in the coming 5 years, resulting in an average GDP growth rate of 2.8%.
If you want to invest in real estate in Lagos it's a good thing because, usually, when the economy grows, people make more money, and this encourages them to invest in real estate, which drives up the demand and prices for properties.
Also, in Nigeria, the average GDP per capita has dropped by 2.5% over the last 5 years. It's an alarming number.
Looking for more updated data? We've done a big-picture study to find out if it's a good idea to purchase property in Nigeria right now.
Buying property in Lagos
Buying real estate in Lagos can be difficult due to the lack of reliable and up-to-date information about the market. That's why we have created the pack to buy property in Lagos and in Nigeria.
Buying process
In the pack of documents we have built, we've covered everything about buying a property, from the contacts you'll need to the taxes that need to be paid, and even where to look for available properties.
Now, we're presenting a simpler version to make it easier for you to understand and follow along.
This is the step-by-step process to purchase a property in Lagos, Nigeria:
- Research and define your budget in Naira (local currency).
- Engage a licensed Nigerian real estate agent.
- Inspect potential properties, considering factors like proximity to amenities and local regulations.
- Obtain a Survey Plan, which outlines property boundaries and size.
- Conduct a Title Search to verify ownership and check for any encumbrances.
- Negotiate the purchase price and terms, considering factors like "Area Boys" fees (informal local charges).
- Sign a Sales Agreement, including full property details and agreed-upon terms.
- Pay the agreed deposit, usually around 10% of the property price.
- Conduct due diligence on the property, checking for building approvals and compliance.
- Secure a mortgage through a Nigerian financial institution (if needed).
- Finalize legal paperwork, including a Deed of Assignment, and obtain the Governor's Consent (required for certain types of property).
- Pay all necessary fees and taxes, such as Stamp Duties, Capital Gains Tax, and registration fees.
Upon completion, receive the property's title, usually a Certificate of Occupancy or a Governor's Consent, and collect the keys to your new property in Lagos.
Also, if you're not from the country, you might want to check our article on how to buy property as a foreigner in Nigeria.
Make a profitable investment in Lagos
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Where to find a property
Explore these websites to find properties in Lagos.
- Nigeria Property Centre - A leading real estate and property website in Nigeria, offering property listings for sale, rent, and lease across various locations and property types.
- Private Property - A comprehensive real estate website offering property listings for sale, rent, and short-term lets, along with news, guides, and resources.
- Listproperty - A Nigeria property portal that offers a wide range of properties for sale, rent, and lease, including houses, flats, land, and commercial properties.
- Property 24 - An online platform providing a wide range of properties for sale and rent across various cities and regions in Nigeria.
- Property Point Nigeria - An online platform in Nigeria that allows users to search and find properties for sale, lease, rent, and school hostels.
Also, know that we have included contacts of real estate agencies, property lawyers, moving companies, expats communities and more in our pack for buying property in Nigeria.
Which properties for which budget?
As mentioned before, the average price per sqm in Lagos is $2,500. A 1-bedroom property with an area of 60 square meters would cost approximately $150,000, and a 2-bedroom property with an area of 85 square meters would cost around $213,000.
Of course, the price of properties can be influenced by their qualities and the area they're in.
Top neighborhoods in Lagos will come with higher price tags. An apartment in Ikoyi could be about $290,000, whereas a house in Victoria Island might be priced at $440,000.
On the other hand, some places are more affordable. You could find an apartment in Mushin for $80,000, or you may come across an apartment in Ajegunle priced at only $40,000.
We give more details about property types and areas in our full pack for buying property in Nigeria.
Common mistakes
Here are the main pitfalls specific to buying property in Lagos (Nigeria)
- Omonile (Land Grabbers): Beware of unauthorized individuals claiming ownership and demanding additional payments.
- Certificate of Occupancy authenticity: Verify the legitimacy of land documents to avoid fraud.
- Land Use Act: Understand its implications on land ownership and rights.
- Land regularisation: Ensure all necessary permits and approvals are obtained.
- Tenement rates: Be aware of local property taxes and levies.
- Area Boys' influence: Some areas may have local youth groups demanding unofficial fees.
- Land measurement discrepancies: Confirm land size to avoid disputes over property boundaries.
- Property developers' reputation: Research builders' track records and project completion history.
We don't want this to happen to you, so we have included a full checklist for your property investment in our pack of documents. Avoid these mistakes and save a lot of money.
Everything you need to know is included in our Nigeria Property Pack
Living in Lagos
Living in Lagos is an exciting and vibrant experience, offering a great opportunity to invest in a city full of culture, history, and a thriving economy.
Cost of living
The cost of living in Lagos is generally higher than the national average due to the city's high population density and the availability of certain goods and services. Prices for basic necessities such as food, housing, and transportation can be quite expensive.
Here are some examples to better understand the cost of living in Lagos, Nigeria:
- Rent for a one-bedroom apartment in the city center: $455/month.
- Monthly public transportation pass: $13.
- Dinner for two at a mid-range restaurant: $27.
- 1 liter of gasoline: $0.42.
- Utilities (electricity, water, heating) for an 85m² apartment: $83/month.
- Gym membership at a local fitness center: $42/month.
- Ticket to a movie at a cinema: $7.
- Cup of locally brewed palm wine at a bar: $2.
Neighbourhoods
We like to show information in an easy-to-understand way. So, we made a table to list the different areas in Lagos (Nigeria)ds, prices and rents, check our property pack.
| Neighborhood | Description | Strengths | Weaknesses |
|---|---|---|---|
Ikoyi | Ikoyi is an upscale neighborhood known for its luxurious apartments, high-end shopping, and waterfront views. It is a prime residential and commercial area, attracting expatriates and affluent locals. | Exclusive residential options, proximity to business districts, waterfront amenities. | High property prices, heavy traffic during peak hours. |
Lekki | Lekki is a rapidly developing area with a mix of residential estates, commercial centers, and entertainment hubs. It's popular for its vibrant nightlife and access to beaches. | Growing real estate market, entertainment options, proximity to beaches. | Some areas prone to flooding, ongoing construction can cause congestion. |
Victoria Island | Victoria Island is a major business and entertainment hub with modern skyscrapers, hotels, and restaurants. It's a central location for corporate offices and upscale nightlife. | Business opportunities, vibrant nightlife, a variety of dining options. | High cost of living, heavy traffic congestion. |
Surulere | Surulere is a well-established residential neighborhood with a mix of middle-class and upper-class residents. It has a rich cultural heritage and offers easy access to other parts of Lagos. | Rich cultural history, diverse housing options, good connectivity. | Some areas may lack modern amenities, occasional traffic congestion. |
Yaba | Yaba is a lively area known as the technology hub of Lagos, housing various tech companies and startups. It's a popular choice for students and young professionals due to its affordable housing options. | Thriving tech ecosystem, affordable housing, vibrant student community. | High-density population, limited green spaces. |
Ikeja | Ikeja is the capital of Lagos State and a major commercial and transportation center. It's home to the Murtala Muhammed International Airport and government institutions. | Transportation hub, government offices, proximity to the airport. | High traffic congestion, limited open spaces. |
Festac | Festac is a residential area known for its housing estate constructed for the Festival of Arts and Culture in 1977. It has a strong community spirit and various amenities. | Community atmosphere, recreational facilities, good housing options. | Some parts may lack modern infrastructure, traffic congestion. |
Apapa | Apapa is a major port area with a significant industrial presence. It plays a crucial role in trade and commerce but faces traffic and environmental challenges. | Port facilities, commercial importance, job opportunities. | Severe traffic congestion, environmental pollution. |
Agege | Agege is a densely populated area with a mix of residential and commercial zones. It has a bustling market and is well-connected to other parts of Lagos. | Marketplace, affordable housing, good transport links. | High population density, traffic congestion during rush hours. |
Life in Lagos
Lagos has one of the most vibrant and dynamic economies in Africa. It is a major hub for finance, commerce, and industries such as oil, construction, and entertainment, and is home to a large population of entrepreneurs and small businesses.
Based on IMF data, the GDP of Lagos makes up nearly 15% of Nigeria's GDP. Investing in property in a city with a strong GDP is smart because the city's thriving economy suggests more jobs, higher demand for real estate, and stable property values, making it a favorable investment environment.
What expats usually like the most in Lagos is the vibrant nightlife and the beautiful beaches. They also enjoy exploring the city's many cultural attractions, such as the National Museum, the National Theatre, and the National Gallery.
However, the crime rate of Lagos is still very high (with a value of 68, one of the worst scores in the world). The most common crimes in Lagos are robberies, burglaries, muggings, pickpocketing, and car theft.
Also, you have to know that Lagos deals with traffic congestion and flooding issues as a result of its rapid urbanization and coastal position.
A good point for a property investor - there is a mass rapid transit system in Lagos called the Lagos Rail Mass Transit.
Access to healthcare in Lagos is good, with a Healthcare Index of 47. Good healthcare facilities is a positive indicator in a real estate market.
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Renting out in Lagos
This section is for those who are looking to purchase a property not to live in themselves, but to rent it out and make an income from the rental.
Long-term
Tenant Profiles in Lagos
According to the data reported by Wikipedia, the home ownership rate in Nigeria is 25%, which is very low.
It means that, if you decide to buy and rent out in Lagos, there will be a huge tenant pool. It's a good thing.
If you decide to buy and rent out to long-term tenants, you should target professionals, expats, and students in Lagos, as well as families seeking a more affordable option than the high-end residential areas. For short-term rentals, you should target business travelers, tourists, and other people looking for an affordable place to stay in the city.
Here is a little summary table we've made for you.
| Property type and area | Profiles of potential tenants | What they are looking for | Expected monthly rent in $ |
|---|---|---|---|
Apartment in Victoria Island | Professionals, expats | Luxury living, waterfront views | $1000 - $3000 |
House in Lekki | Families, upper-middle class | Secure environment, modern amenities | $1500 - $4000 |
Studio in Ikeja | Youth, students | Proximity to universities, affordability | $300 - $800 |
Apartment in Yaba | Young professionals, students | Urban living, cultural scene | $400 - $1200 |
Flat in Surulere | Local residents | Community atmosphere, affordability | $200 - $600 |
House in Ajah | Families, middle-class | Suburban living, family-friendly | $800 - $2000 |
Apartment in Ikoyi | High-end renters | Prestigious location, upscale amenities | $2000 - $6000 |
Rental yields
These days, Lagos presents attractive opportunities in terms of rental yields. In fact, you can easily achieve yields above 9% due to the high demand for rental property and the large population of potential tenants.
In Lagos, rental yields tend to be highest in neighbourhoods with good infrastructure and amenities such as good public transport links, good schools, and good access to shopping and leisure facilities. This is because these locations tend to attract higher rental demand from tenants, leading to higher rental yields for landlords.
For further explanation and a more detailed breakdown, you can check the reports and analyses we have made.
Short-term
You could also decide to rent short-term to business travellers, tourists, or students looking for somewhere to stay temporarily in Lagos. Digital nomads and remote workers in need of an office space for a short period of time are also potential tenants.
If you decide to go with that option, look for properties in Lagos Island, Ikoyi, and Victoria Island. These areas are highly sought after by short-term tenants due to their proximity to the city centre and other attractions.
Currently, there are approximately 10,000 active Airbnb listings in Lagos, reflecting a highly dynamic and bustling short-term rental market. The average daily rate stands around $99.
You have the opportunity to generate a nice additional income stream then. According to online testimonials and analytics platform like AirDNA, Guesty and Inside Airbnb, people who offer short-term rentals in Lagos can make around $600 per month. Also, the average occupancy rate is estimated at 23%.
Is it worth buying real estate in Lagos (Nigeria) then?
Buying property in Lagos, Nigeria, can be a savvy move if you're in it for the long haul. Lagos has a booming economy, offering opportunities for both personal growth and real estate investment. The property price-to-rent ratio is low, making it financially viable for those who want to build long-term wealth through property appreciation.
If you're planning to stay for a while and benefit from the city's thriving economy, buying property in Lagos can be a smart decision. However, it's not for everyone. If you're a short-term resident, concerned about instability or safety issues, or unwilling to tackle the complexities of the Lagos real estate market, renting might be a more practical option.
Additionally, Lagos has its challenges, including high crime rates, traffic congestion, and flooding problems, which could deter some potential buyers. To make an informed choice, carefully weigh your financial goals and risk tolerance, conduct thorough research, and consider seeking local expert advice.
In Lagos, the key to success in property investment is a well-thought-out, long-term strategy.
Make sure you understand the real estate market in Lagos
Don't rush into buying the wrong property in Nigeria. Sit, relax and read our guide to avoid costly mistakes and make the best investment possible.
The content provided here is for informational purposes only and does not imply endorsement or advice. While we strive for accuracy, we do not guarantee the completeness or reliability of the information, including text, images, links, or other elements in this material. Following the content and analyses presented here does not assure specific outcomes. For guidance tailored to your individual circumstances, it is recommended to consult with a professional, such as a lawyer, accountant, or business advisor.