Authored by the expert who managed and guided the team behind the Nigeria Property Pack
Yes, the analysis of Lagos' property market is included in our pack
What is happening in Lagos’s real estate market? Are prices on the rise or decline? Is Victoria Island still a prime location for foreign investors? How are Nigeria’s government policies and taxes shaping the real estate landscape in 2025?
These are the questions we hear every day from professionals, buyers, and sellers across Lagos, from Ikeja to Lekki and beyond. Perhaps you’re curious about these trends too.
We know this because we stay closely connected with local experts and individuals like you, exploring the Lagos real estate market daily. That’s why we crafted this article: to offer clear answers, insightful analysis, and a comprehensive view of market trends and dynamics.
Our aim is straightforward: to make sure you feel informed and confident about the market without needing to search elsewhere. If you think we missed something or could improve, we’d love to hear your feedback. Feel free to message us with your thoughts, and we’ll strive to enhance this content for you.
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1) Rental yields in Lagos's high-end neighborhoods will drop as supply surpasses demand
In Lagos, high-end neighborhoods like Ikoyi and Victoria Island are seeing a slowdown in rental growth.
Why? Well, there's been a boom in luxury apartment construction. Picture this: up to 753 luxury units priced at $1 million or more are being built in places like Old Ikoyi, Eko Atlantic, and Banana Island. This has led to an oversupply, leaving many of these posh apartments empty or barely occupied.
People are changing their preferences too. More are choosing affordable spots like Yaba and Surulere, which offer better value for money. In prime areas like Lekki and Ikoyi, rental yields are just 3% to 5%, while emerging areas boast higher yields of 6% to 8%.
Economic factors are also at play. The high cost of living in Lagos is squeezing demand and pricing for luxury apartments. Inflation and reduced disposable income among expatriates are making high-end rentals less attractive. Plus, tenants are grumbling about high prices and not-so-generous apartment sizes and amenities.
Experts and media reports are buzzing about the oversupply of luxury properties, predicting market saturation. Property owners in these upscale areas are noticing longer vacancy periods, a clear sign of declining rental demand.
All these factors point to one thing: rental yields in these high-end neighborhoods are likely to drop as supply continues to outpace demand.
Sources: Knight Frank, Estate Intel
2) Foreign investors will target Lagos's emerging neighborhoods for higher returns
Foreign investors are eyeing Lagos's emerging neighborhoods for promising returns.
Take Ibeju-Lekki, for example, where massive infrastructure projects like the Dangote Refinery and the Lekki Free Trade Zone are driving rapid growth. These developments are not just about industrial expansion; they are expected to significantly boost property values as they reach full capacity, making early investments potentially very lucrative.
The Lagos State budget for 2025 is another game-changer, with a substantial portion allocated to capital expenditures focusing on critical infrastructure. Projects like the Green Line rail development, which will connect Marina to the Lekki Free Trade Zone, are set to further enhance property values in these areas. Such improvements are likely to increase demand and prices, attracting investors looking for growth opportunities.
Moreover, the Lagos State government is prioritizing tourism and infrastructure development, aiming to enhance property values and attract more investors. This focus on creating spaces for artistic expression and drawing international tourists is expected to make these emerging neighborhoods even more appealing to foreign investors.
Insider knowledge suggests that foreign investors are particularly interested in these areas due to the potential for high returns. The combination of infrastructure development and government focus on tourism creates a unique opportunity for those looking to invest in Lagos's real estate market.
With these factors in play, it's no wonder that some foreign investors are focusing on Lagos's emerging neighborhoods for higher returns. The blend of infrastructure growth and government initiatives makes these areas a hotbed for investment.
Sources: Nimble Casa, Travel and Tour World, Mirror Homes Investments Ltd
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Nigeria. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
3) Mid-range properties in Lagos will maintain stable yields with steady demand from middle-income earners
Mid-range properties in Lagos are seeing stable yields thanks to a steady demand from middle-income earners.
Over the last ten years, these properties have consistently offered rental yields between 6% and 8% annually, which is quite appealing when you compare it to other big cities in Nigeria. This makes them a solid investment choice for those looking to buy property in the country.
Real estate agencies in Lagos are buzzing about the strong demand for mid-range housing. The city's middle-income earners are on the hunt for homes that are both affordable and of good quality. These properties hit the sweet spot, offering a balance of price and quality that makes them a top pick for many.
Recent economic reports show that the middle-income group in Lagos is not only stable but also growing. This growth is a key factor in the ongoing demand for mid-range properties, ensuring that property owners enjoy a consistent rental income. As Lagos continues to urbanize rapidly, the need for housing is on the rise, further supporting the stability of these property yields.
With more people flocking to Lagos, the demand for affordable housing options is only going to increase. This trend is a boon for those investing in mid-range properties, as it promises steady returns.
Sources: Propsult, Nigeria Housing Market
4) Lagos luxury property prices will rise as high-net-worth individuals seek exclusive homes
The luxury real estate market in Lagos is seeing a notable price increase as high-net-worth individuals hunt for exclusive properties.
By 2025, the average property price in Lagos is expected to hit around ₦50 million, marking a significant rise from previous years. This surge is driven by both the growing demand and ongoing urban development.
Areas like Victoria Island, Eko Atlantic City, Banana Island, Ikoyi, and Lekki are particularly appealing to the wealthy, expatriates, and multinational companies. These neighborhoods are famous for their high-end real estate offerings, attracting affluent buyers who crave exclusivity and luxury.
Nigeria boasts the third highest number of high-net-worth individuals in Africa, and this affluent population is fueling the demand for luxury properties in Lagos. The supply of new housing units isn't keeping up, leading to a projected housing deficit of about 3 million units by 2025.
In these luxury neighborhoods, the allure isn't just about the properties themselves but also the lifestyle they offer. From world-class amenities to stunning waterfront views, these areas provide a unique living experience that appeals to the elite.
Sources: Source 1, Source 2, Source 4
5) Victoria Island will shift to more luxury developments with rising demand for high-end living
Victoria Island is experiencing a significant rise in property prices, with apartments now costing between ₦1.5 million and ₦5 million per square meter.
Houses aren't far behind, with prices ranging from ₦500 million to ₦2 billion, indicating a shift towards luxury developments in the area. This trend is driven by a surge in high-end real estate projects, with over 753 luxury apartments currently under construction in Lagos, many of which are on Victoria Island.
The construction boom is a response to the growing demand for upscale living spaces, as more expatriates and high-net-worth individuals flock to the area. These affluent buyers are attracted by the presence of international companies and the expanding business districts, seeking properties that offer top-notch amenities.
Buyers are particularly interested in homes that provide 24/7 security, swimming pools, and gyms, making these features almost standard in new developments. The influx of wealthier residents is reshaping the real estate landscape, pushing developers to focus on high-end offerings.
As a result, Victoria Island is becoming a hotspot for luxury living, with developers keen to meet the expectations of this discerning clientele. The area's transformation is evident in the increased number of premium housing projects and the amenities they offer.
For those considering a property investment, Victoria Island presents an opportunity to tap into a market that is rapidly evolving towards luxury. The demand for high-end living is not just a trend but a defining feature of the area's future.
Sources: CW Lagos, Estate Intel
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6) Ikoyi's price growth will slow as investors shift focus to emerging areas
Ikoyi has long been a hotspot for real estate, but by 2023, price growth started to slow down.
In Old Ikoyi, the average land price jumped from N514,890 per square meter in 2021 to N1.1 million per square meter by 2023, a whopping 113% increase. But this rapid rise is cooling off as investors eye more budget-friendly areas.
Places like Lekki, Ajah, and Epe are buzzing with real estate action. Ibeju-Lekki, dubbed the "New Lagos," is home to big projects like the Dangote Refinery and the Lekki Deep Sea Port. These developments are drawing in businesses and residents, making these areas hotspots for residential and commercial properties.
Ikoyi's rising living costs and property taxes are turning off new investors. While exact tax figures aren't available, the trend of increasing costs is clear. Meanwhile, infrastructure upgrades in emerging areas, like the expansion of the Lekki-Epe Expressway and plans for a new international airport in Epe, are making these places more accessible and attractive.
Investor interest is shifting towards these emerging areas, which offer affordable options and high growth potential. The buzz around these locations is hard to ignore, especially with the promise of better infrastructure and major projects underway.
As more investors look beyond Ikoyi, these emerging areas are becoming the new go-to spots for real estate investment, offering a mix of affordability and opportunity that Ikoyi can no longer match.
Sources: Plus World Realtors, Northcourt Real Estate, Titan Resources Limited
7) High-rise apartments will become more popular in Lagos as land availability decreases
Lagos is rapidly growing, and by 2025, its population could exceed 20 million residents.
With more people comes a need for housing, and high-rise apartments are becoming a popular choice. In areas like Old Ikoyi, land prices have more than doubled from 2021 to 2023, making it clear that building upwards is a smart move. High-rise buildings make the most of the limited and expensive land available.
The Lagos government is on board with this trend, pushing for vertical development through various policies. These efforts are all about better urban management and efficient land use, which naturally supports the rise of high-rise buildings. In central Lagos, where undeveloped land is scarce, vertical expansion is a must.
Experts in urban planning are all for this shift. Reports and studies consistently highlight vertical expansion as a key solution to the housing crunch and land scarcity in Lagos. They stress the importance of using land efficiently, something that high-rise developments excel at.
For those considering buying property in Lagos, it's worth noting that high-rise apartments are not just a trend but a necessity. The city's limited land availability and rising costs make these developments a practical choice. As Lagos continues to grow, high-rise living will likely become the norm.
Sources: The Africanvestor, Atlas of Urban Expansion, World Bank Documents and Reports, Northcourt Real Estate
8) Lagos will see rising demand for accessible housing due to an aging population
Lagos is seeing a shift in its population dynamics as more people live longer.
In 2023, Nigeria's life expectancy hit 63.4 years, meaning folks are sticking around longer than before. This means more elderly residents in Lagos, and with that comes a change in housing needs. Older adults often look for homes that are easy to get around in, like single-story houses or places with elevators.
By 2023, over 3% of Nigeria's population was aged 65 and above, and this number is climbing. Many older Nigerians want to stay in their own homes and communities as they age, a trend known as "aging in place." This preference is backed by studies showing that older folks want to remain in familiar surroundings.
But here's the catch: Lagos is grappling with an affordable housing crisis. The demand for accessible housing is outpacing supply, creating a significant challenge for everyone, especially the elderly. The real estate market is feeling the pressure, with a growing need for affordable and accessible housing options.
For those considering buying property in Lagos, it's crucial to understand this dynamic. The aging population is driving a demand for homes that cater to their needs, yet the market isn't quite keeping up. This could mean opportunities for investment in properties that offer accessibility features.
As Lagos continues to evolve, the need for housing that accommodates an aging population will only grow. Investors and developers have a chance to meet this demand by focusing on accessible and affordable housing solutions.
Sources: World Bank Report on Lagos Development Priorities, Population Ages 65 and Above in Nigeria, Preferred Care Settings for Older Persons
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Nigeria versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
9) Yaba will attract more interest as its tech hub status grows
Yaba in Lagos is quickly becoming a hotspot for tech innovation.
In recent years, Nigeria's tech scene has been buzzing, especially with over $2 billion flowing into fintech in 2024. This momentum is expected to grow, with predictions of more than $3 billion in tech investments by 2025. Yaba is right at the heart of this boom, making it a prime spot for tech enthusiasts and investors.
Yaba hosts several key players like Passion Incubator and NG-HUB, offering co-working spaces and cutting-edge facilities for startups. These hubs are not just about space; they provide a community and resources that are essential for new tech companies to thrive. The Lagos State government is also in on the action, backing initiatives like the Yaba Technology Cluster (K.I.T.E.), a massive tech campus in collaboration with giants like Facebook and Google.
Education is another pillar of Yaba's tech rise. With institutions like the University of Lagos and Yaba College of Technology nearby, there's a steady stream of tech-savvy graduates ready to join the workforce. This influx of talent is a big draw for companies looking to set up shop in the area.
Connectivity is key, and Lagos State is making sure Yaba is well-equipped by laying down 3,000 kilometers of fiber optic cables. This infrastructure is crucial for supporting the tech industry's needs, ensuring fast and reliable internet access for businesses and residents alike.
With all these elements in play, Yaba is not just a neighborhood; it's becoming a thriving ecosystem for tech innovation. The combination of investment, infrastructure, and talent makes it an exciting place for anyone looking to dive into Nigeria's tech scene.
Sources: Business Day, Nairametrics, Nucamp, Business Day
10) Smart home technology will be a major selling feature for new developments in Lagos
Smart home technology is becoming a big deal in Lagos.
In Lagos, the smart home market is on the rise, with an expected growth of 11.35% from 2024 to 2029. This boom is part of a larger trend in the Internet of Things (IoT) sector, which is set to reach $5 billion by 2025. The push is largely due to urban development projects that are reshaping the city.
People in Nigeria are getting more tech-savvy, with over 70% now familiar with smart devices. This growing awareness is paired with a strong desire for homes that offer energy efficiency and better security. Features like alarm systems and wireless cameras are making smart homes a hot commodity.
The real estate scene in Lagos is feeling the impact too. From 2021 to 2023, there was a 50% jump in real estate sales, thanks to higher demand and more buying power. Smart home tech is now a major selling point, with investments in this area expected to grow by 200% by 2023.
The Nigerian government is also on board, pushing for tech integration in housing through policies that back smart city projects. This support, along with collaborations between tech firms and real estate developers, means new homes in Lagos are likely to feature the latest smart technologies.
With these trends, smart home technology is set to become a key selling point for new developments in Lagos, making it a must-have for future homeowners.
Sources: Statista, Novatia Consulting, Light Now Blog, Eystone, 6Wresearch
11) Epe will emerge as a prime area for long-term investments with its future development potential
Epe is quickly becoming a hotspot for long-term investments due to its strategic developments.
The Lagos State Government is rolling out major infrastructure projects like the Epe Mixed Development Scheme and Labour City. These initiatives aim to provide essential amenities such as roads, electricity, and water, making Epe more livable and attractive to investors. These improvements are transforming Epe into a more appealing place to live and invest.
Transportation is also getting a boost with the construction of the Lekki-Epe Link Bridge and the Lagos Green Line Metro. These projects are designed to enhance connectivity, making it easier for people and goods to move in and out of Epe. This improved access is expected to fuel economic growth, drawing more businesses and investments to the area.
Epe's proximity to the Lekki Free Trade Zone, a major economic hub, adds to its allure. Businesses are likely to be attracted to this area, given its strategic location. The economic activities in the Free Trade Zone are likely to spill over into Epe, further boosting its investment potential.
Real estate developers are increasingly eyeing Epe, driven by its potential for future development. This interest is evident in the rising land prices, indicating that the area is becoming more attractive for long-term investments. The ongoing urban expansion in Lagos is pushing demand for housing in Epe, which can lead to more residential and commercial projects.
With all these developments, Epe is poised to become a key player in Lagos's urban landscape. Investors are taking note of Epe's strategic location and development potential, making it a promising area for future growth.
Sources: Epe Mixed Development Scheme and Labour City Project, Lagos State Government's Infrastructure Projects
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12) New road networks in Lagos will enhance connectivity and increase real estate demand in previously inaccessible areas
Lagos is buzzing with new road networks, making it easier to get around and boosting real estate interest.
The 35-km Apapa-Oshodi-Oworonshoki-Ojota Expressway is a prime example, opening up areas that were once tough to reach. This expansion has led to a surge in property transactions as people and businesses flock to these newly accessible spots.
Another big change is the Lagos Rail Mass Transit (LRMT) system, especially the LRMT Blue Line, which can move up to 250,000 passengers daily. This has eased traffic jams and made commuting a breeze, catching the eye of real estate developers eager to invest near rail lines and stations.
Government reports from that time show that infrastructure investments have had a positive impact on local economies. The Lagos State government's focus on improving transportation and public services has made previously underdeveloped areas more appealing for real estate investment.
This infrastructure push has not only made Lagos more livable but has also sparked commercial activity and new business openings in areas that are now easier to reach. The commitment to better roads and public transport is transforming the cityscape and creating new opportunities.
For anyone considering buying property in Lagos, these developments mean more options and potentially better returns. The city's ongoing improvements in connectivity are reshaping the real estate landscape, making it an exciting time to invest.
Sources: Oxford Business Group, Switchlanes Properties, IFC
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility.