Authored by the expert who managed and guided the team behind the Nigeria Property Pack
Everything you need to know before buying real estate is included in our Nigeria Property Pack
What do the latest numbers reveal about Nigeria’s real estate market? Are property prices on the rise, or are they stabilizing? Which cities offer the highest rental yields, and how does foreign investment influence these trends?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with developers, real estate agents, and clients who invest in Nigeria, we’ve gained firsthand insights into these trends. Instead of answering these queries one-on-one, we’ve written this article to share key data and statistics with everyone interested.
Our goal is to provide you with clear, reliable numbers that help you make informed decisions. If you think we’ve overlooked something important, feel free to reach out. Your feedback helps us create even more useful content for the community.
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1) Residential properties in Nigeria offer rental yields of 6% to 10% annually, attracting investors
The rental yield for residential properties in Nigeria averages between 6% and 10% annually, making it attractive for investors.
Location is crucial. In prime spots like Banana Island or Maitama, high demand meets high property prices, which can squeeze yields. But in places like Victoria Island, where demand is high and supply is tight, rental yields often perform better.
Economic factors also play a part. When the Naira depreciates, properties with dollar-based rents can see increased yields when converted to Naira. This fluctuation can be a boon for investors looking to maximize returns.
Urbanization is another driver. As more people move to cities like Lagos and Abuja for work, the demand for rental properties rises. This trend is supported by a growing middle class and a steady influx of expatriates, boosting the rental market.
Sources: Nigeria Prebook Homes, The Africanvestor, The Africanvestor
2) Residential properties in Nigeria are appreciating at an annual rate of 5% to 8%
The average annual appreciation rate for residential properties in Nigeria is currently between 5% and 8%.
Nigeria's economy is on a steady growth path, largely due to its efforts in diversifying economic activities and attracting foreign investments. This economic boost enhances consumer confidence and purchasing power, which naturally increases the demand for real estate. As more people look to buy, property prices tend to rise.
Urbanization is another key factor. Many people are moving from rural areas to cities, which is shaping the real estate market. This shift leads to a higher demand for housing and commercial spaces in urban areas, pushing property values up as cities expand.
Government policies also play a crucial role. By offering tax incentives and simplifying approval processes, the government encourages real estate development. These policies stimulate market activity, often resulting in higher property prices.
In cities like Lagos and Abuja, the demand for residential properties is particularly high. This demand is driven by a growing middle class and an influx of expatriates, which further fuels property appreciation. As these cities develop, the value of real estate continues to climb.
Overall, the combination of economic growth, urbanization, and supportive government policies creates a dynamic real estate market in Nigeria. This environment makes property investment an attractive option for many, as the potential for appreciation remains strong.
Sources: The Africanvestor, Magnificent NG
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.
3) New gated communities made up about 20% of residential developments in Lagos in 2024
In 2024, new gated communities accounted for about 20% of residential developments in Lagos.
These gated communities are popular because they offer security and exclusive living environments, which are highly valued by both upper-class and middle-income residents. With amenities like schools, gyms, and shopping complexes, they provide a convenient lifestyle that appeals to many.
The real estate market in Lagos is buzzing, driven by rapid population growth and urbanization. However, there's a big housing shortage, especially in affordable housing, which means demand is outstripping supply. This shortage has likely nudged developers to focus on gated communities to meet the need for secure and exclusive living spaces.
Prime areas like Ikoyi, Victoria Island, and Lekki are hotspots for luxury homes. These locations have seen high growth in property prices due to their superior infrastructure, security, and amenities, making them ideal for new gated community developments.
Despite a drop in commercial real estate development in Lagos State, the demand for residential properties in these prime areas remains strong. This trend highlights the ongoing interest in secure and well-equipped living spaces.
Sources:: Nairametrics, Sujimoto, Real Estate Market Blog
4) Nigeria's housing deficit is estimated at 17 to 20 million units by 2025, showing huge demand
The Nigerian housing deficit is estimated to be between 17 and 20 million units as of 2025, highlighting an enormous demand.
Rapid urbanization is a major factor. By 2025, over 60% of Nigerians will live in cities like Lagos, Abuja, and Port Harcourt. This shift is driving a strong need for homes, especially affordable ones for middle- and low-income families.
Despite developers' efforts with large-scale projects, the housing gap remains a big issue. The deficit has grown, showing the huge demand for urban housing. The government and stakeholders are trying to close this gap with public-private partnerships and housing schemes.
Sources: Real Estate Market Trends in Nigeria: What to Expect in 2025, Addressing Housing Deficit in Nigeria: Issues, Challenges and Prospects
5) In 2024, over 5,000 new housing units in Abuja met less than 10% of the housing demand
In 2024, Abuja built over 5,000 new housing units, but this met less than 10% of the city's housing demand.
The city's housing demand is skyrocketing due to rapid urbanization and a flood of investors, both local and international. This surge is particularly intense for affordable housing, which the new units couldn't fully satisfy.
Areas like Kubwa FO1, Jikwoyi, and Kurudu are in the spotlight for affordable housing. These neighborhoods are popular among young professionals and families, yet the supply of new homes there fell short of the high demand.
In these areas, the focus is on budget-friendly homes, but the available new units just aren't enough. The demand is outpacing supply, leaving many potential buyers still searching.
Despite the construction boom, the housing market in Abuja is still struggling to keep up. The gap between supply and demand remains significant, especially in sought-after locations.
Sources: Naija Houses, Realty360 Innovations, Everview Properties
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6) Urban housing demand in Nigeria rose as 53% of Nigerians lived in urban areas by 2024
In 2024, 53% of Nigerians lived in urban areas, driving up the demand for city housing.
Back in 2023, 54.28% of Nigeria's population was already urban, according to World Bank data. This set the stage for even more people moving to cities, as urban living became increasingly popular.
The urban population in Nigeria grew at a rate of 3.5121% annually in 2023. This steady climb meant more people were packing up and heading to the cities, pushing the urban population percentage higher by 2024.
PwC's report shed light on this rapid urbanization, showing how it impacted the housing market. As more folks moved to urban areas, the demand for city housing naturally shot up.
With more people seeking the conveniences of city life, urban housing became a hot commodity. This trend was a direct result of the increasing urbanization across Nigeria.
As cities expanded, the need for affordable housing solutions grew, prompting developers to focus on meeting this demand.
Sources: World Bank Development Indicators, PwC Report on Affordable Housing, Trading Economics
7) Real estate developers in Nigeria increased by 10% in 2024, showing rapid market evolution
The number of real estate developers in Nigeria grew by 10% in 2024, reflecting the market's rapid evolution.
This surge is largely due to the significant expansion of the Nigerian real estate market, which was projected to grow by 7.24% in 2024, reaching an estimated value of $2.14 trillion. With a booming population, the demand for residential properties is on the rise, making it a hot spot for potential buyers.
Investors are flocking to the market, drawn by its potential for diversification and high growth rates. Emerging markets, fueled by infrastructural development, are ripe for exploration, offering new developers a chance to seize these opportunities.
PropTech, or property technology, is revolutionizing the way people buy and sell properties. It streamlines property searches, enhances engagement through virtual tours, and makes transactions easier with digital payment solutions.
Government initiatives are also paving the way for growth. Infrastructural development projects are opening up new investment opportunities in previously untapped areas, making them more attractive to developers.
Sources: Greenland Concepts, CNBC Africa, Northcourt Real Estate
8) Around 70% of Nigerians rely on savings or family support to buy homes due to unaffordable mortgage financing
In Nigeria, housing affordability is a significant challenge.
In Lagos State, a study revealed that housing units are priced beyond the reach of low to medium-income earners. This means that only about 10% of Nigerians who dream of owning a home can actually afford it. The situation is starkly different in countries like the USA, UK, and Singapore, where home ownership rates are considerably higher.
The Central Bank of Nigeria supports this finding, reporting that just 10% of Nigerians can afford to buy or build their own homes. This is a stark contrast to the more accessible housing markets in other parts of the world.
One of the main hurdles is the high interest rates on mortgages in Nigeria. These rates, which average between 18% to 20%, make it extremely difficult for people to secure affordable housing through mortgage financing. This financial barrier forces many to rely on savings or family support instead.
With such high interest rates, an estimated 70% of Nigerians cannot afford mortgage financing. This leaves a large portion of the population without viable options for home ownership, relying instead on personal savings or family assistance.
Sources: RSIS International, Central Bank of Nigeria, CNBC Africa
We have made this infographic to give you a quick and clear snapshot of the property market in Nigeria. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
9) Around 80% of residential real estate deals in Nigeria are done in cash instead of formal financing
In Nigeria, cash is king when it comes to buying homes.
The real estate market is thriving, with more people flocking to urban areas and having extra cash to spend. This urban migration is fueling a housing boom, but the exact split between cash and loan purchases remains unclear. However, it's evident that cash plays a significant role in these transactions.
Many Nigerians prefer cash because it's straightforward and helps them manage their finances, especially during economic uncertainty. This preference is reflected in the fact that about 80% of residential real estate transactions are conducted in cash rather than through formal financing.
In 2023, 76% of all transactions in Nigeria, including those at stores and online, were made using cash. This trend highlights the country's reliance on cash, even as digital payment options grow.
Cash's popularity isn't just about convenience; it's also about trust. In a country where financial systems can be unpredictable, cash offers a sense of security that digital transactions sometimes can't match.
So, if you're considering buying property in Nigeria, be prepared for a market where cash is often the preferred method of payment.
Sources: Statista, Cash Matters, Statista
10) The number of real estate agents in Nigeria increased by 12% in 2024, showing rapid sector growth
The number of real estate agents in Nigeria grew by 12% in 2024, reflecting the sector’s rapid expansion.
This boom is largely due to the real estate sector's significant contribution to Nigeria's economy. In 2024, the construction and real estate industries together added 11.2 trillion naira to the economy, with real estate alone making up 5.2% of the country's GDP.
Population growth and urbanization are key drivers of this expansion. As more people flock to cities, the demand for housing rises, making real estate a lucrative field. Government initiatives, like infrastructure development projects, have also played a crucial role. For instance, the Nigerian government allocated 548.6 billion naira for road construction and 99 billion naira for developing 20,000 affordable housing units in 2024, attracting more investors.
Nigeria faces a substantial housing deficit, needing an estimated 550,000 housing units annually to meet the growing population demands. This high demand makes the real estate sector an attractive investment opportunity, both locally and internationally.
Predictions indicate a 7.24% growth in Nigeria’s real estate market by the end of 2024, driven by ongoing demand for residential properties.
Sources: Gidi Real Estate Investment, CNBC Africa, Greenland Concepts
11) Over 60% of new residential developments in 2024 were in Lagos, Abuja, and Port Harcourt
In 2024, over 60% of new residential developments were concentrated in Lagos, Abuja, and Port Harcourt.
These cities are booming with rapid population growth and high urbanization rates, driving up the demand for homes. Take Old Ikoyi in Lagos, for instance, where land prices more than doubled from 2021 to 2023. This surge is a clear sign of how attractive these areas have become for property buyers.
Real estate activity is buzzing, especially in neighborhoods like Sangotedo in Lagos. Here, land prices also more than doubled between 2021 and 2023, drawing in developers eager to cater to the needs of city dwellers. It's a hot spot for anyone looking to invest in property.
Government initiatives have been a game-changer, too. By improving transportation networks and access to essential amenities, these cities have become even more appealing for investment. This has created a fertile environment for new residential projects, making it a prime time to consider buying property.
With these developments, Lagos, Abuja, and Port Harcourt are not just growing; they're transforming into major real estate hubs. The combination of population growth, rising land prices, and government support is making these cities the place to be for new residential projects.
Sources: Thinkmint, Northcourt Real Estate, Greenland Concepts
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12) Nigeria’s real estate sector contributed 5.6% to GDP in 2024, up from 5.2% the year before
In 2024, Nigeria's real estate sector contributed 5.6% to the country's GDP, up from 5.2% in 2023.
This growth reflects a stable trend, with the sector consistently contributing around 5-6% to Nigeria's GDP in recent quarters. In the first quarter of 2024, real estate services saw a remarkable surge, growing by 126.71% in nominal terms and contributing 8.80% to nominal GDP.
Despite this progress, the sector faced challenges like inflation, which drove up construction costs and impacted property affordability. The depreciation of the Naira added to these difficulties, making it tough for developers to finish projects on time and within budget.
Yet, the real estate sector's potential to create jobs and boost economic growth remains strong. This is evident in its ability to generate employment opportunities and stimulate related industries, even amid financial hurdles.
Investors are increasingly drawn to Nigeria's real estate market, seeing it as a promising avenue for returns. The sector's resilience and growth potential make it an attractive option for those looking to invest in the country.
As the sector continues to evolve, it plays a crucial role in shaping Nigeria's economic landscape, contributing significantly to the nation's GDP and offering opportunities for economic advancement.
Sources: Punch NG, Business Day, Switch Lanes Properties
13) The average family size in Nigeria’s urban areas is five, boosting demand for larger apartments
The average family size in Nigeria's urban areas has grown to five people, driving up the demand for larger apartments.
As cities like Lagos, Abuja, and Port Harcourt expand, urbanization is rapidly increasing, making the need for spacious housing more urgent. Families are looking for homes that can comfortably fit everyone, and this shift is reshaping the real estate market.
In recent years, particularly in 2023 and 2024, developers have turned their attention to large-scale housing projects to meet this growing demand. Despite these efforts, the country still faces a significant housing deficit, with over 20 million units needed to close the gap.
To tackle this issue, the government has launched initiatives like public-private partnerships, aiming to bridge the housing shortage. These efforts are crucial as the demand for larger living spaces continues to rise.
Secondary cities such as Ibadan, Uyo, and Abeokuta are also becoming hotspots for investment, thanks to urban migration and improving infrastructure. This trend is further fueling the need for bigger apartments to accommodate growing families.
As these cities develop, they offer new opportunities for real estate investors, making them attractive destinations for those looking to capitalize on the demand for larger homes.
Sources: Emerging Housing Markets in Nigeria, Real Estate Market Trends in Nigeria
14) Lagos captured nearly 45% of Nigeria's real estate investments in 2024, remaining the most active market
Lagos is the powerhouse of Nigeria's real estate market, accounting for nearly 45% of all investments in 2024.
As the economic hub of Nigeria, Lagos draws people from all over the country seeking better opportunities, which naturally boosts the demand for housing and commercial spaces. This city isn't just a financial center; it's a vibrant mix of commerce, entertainment, and technology, making it a magnet for both domestic and foreign investors.
Lagos's influence extends beyond finance. It's a key player in education, politics, tourism, art, and fashion across Africa, which contributes to its high market share in real estate. This diverse appeal keeps the market active and attractive to a wide range of investors.
In 2024, Nigeria's real estate sector was set to grow by 7.24%, with a total estimated value of $2.14 trillion. This growth is largely driven by the country's increasing population and the rising need for residential real estate, especially in mid-market areas. Developers are focusing on affordable housing solutions to cater to the expanding demographic.
Lagos stands out in this landscape, with developers keen on meeting the diverse needs of its residents. The city's importance is further underscored by its role in providing affordable housing, which is crucial for accommodating its growing population.
Sources: Urban Real Estate Nigeria, Magnificent Nigeria, North Court Real Estate
We made this infographic to show you how property prices in Nigeria compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
15) Affordable housing supply in Nigeria grew by 6% in 2024 but still falls short of demand
In 2024, the supply of affordable housing in Nigeria grew by 6%, yet it still couldn't meet the high demand.
Nigeria faces a massive housing deficit, with estimates suggesting a shortage of 17 to 20 million units. This means that even with some growth, the supply isn't nearly enough to meet the needs of the population. Over 70% of the urban population lives in inadequate housing conditions, creating immense pressure on the market to provide more affordable options.
The government has tried to tackle this issue through policies like the National Housing Policy. However, these initiatives often face bureaucratic hurdles that slow down their effectiveness. Private developers are crucial in bridging the housing gap, but they encounter challenges like high construction costs and limited access to financing, making it difficult to build more affordable homes.
Despite efforts, the supply just can't catch up with the demand. The housing market struggles to keep pace, and the gap continues to widen. Private developers, while essential, face significant obstacles that hinder their ability to contribute effectively.
High construction costs and limited access to financing are major barriers for developers. These challenges make it difficult to build more affordable homes, further exacerbating the housing deficit. The need for affordable housing remains critical, and the current supply is insufficient to meet the growing demand.
Sources: Novatia Consulting, Business Day, Fundco
16) The Lagos-Ibadan Expressway expansion increased property prices in nearby areas by 10% to 15% in 2024
The Lagos-Ibadan Expressway expansion project significantly boosted property prices in nearby areas by 10% to 15% in 2024.
In 2023, this expansion was a major infrastructure project that greatly improved accessibility and connectivity to Ibadan. This made Ibadan more appealing for commuters from Lagos and beyond. As a result, the demand for housing in Ibadan surged, leading to a boom in residential developments and a rise in property values.
The improved road infrastructure encouraged more people to consider Ibadan as a viable alternative to the more congested Lagos. This shift in preference increased the demand for genuine property in Ibadan, particularly in upscale neighborhoods like Jericho and Agodi GRA.
Additionally, the convenience of rail travel, facilitated by the Lagos-Ibadan railway, made Ibadan an attractive option for those working in Lagos but seeking more affordable or luxurious housing options.
With the expressway expansion, Ibadan became a more practical choice for those looking to escape the hustle and bustle of Lagos while still enjoying easy access to the city. This change in dynamics led to a noticeable increase in property demand and prices.
As a result, Ibadan's real estate market experienced a significant transformation, with more people investing in properties due to the improved infrastructure and connectivity. The expressway project played a crucial role in reshaping the property landscape in the region.
Sources: Emirsoft Group
17) Land prices in emerging areas like Epe and Ibeju-Lekki rose by 12% to 18% in 2024
In 2024, land prices in Epe and Ibeju-Lekki jumped by 12% to 18%.
This surge was largely due to the high growth potential of these areas, driven by major infrastructural projects. Developments like the Lekki Free Trade Zone and Dangote Refinery played a crucial role in boosting property values. The proposed Epe International Airport also added to the appeal, making these regions hot spots for investment.
The Nigerian real estate market was buzzing with demand for both residential and commercial properties, especially in bustling cities like Lagos. This demand was fueled by urbanization, population growth, and a rising middle class. As a result, areas with high growth potential, like Epe and Ibeju-Lekki, became more attractive for investment, leading to increased property values.
Moreover, the Sales Comparison Approach, a method of land valuation, suggested that land prices could fluctuate based on location and development potential. With rapid development in Epe and Ibeju-Lekki, it was plausible that land prices in these areas would rise as they became more desirable.
Investors were keen on these emerging areas, recognizing the potential for significant returns. The combination of infrastructure projects and a growing economy made Epe and Ibeju-Lekki prime locations for property investment.
For anyone considering buying property in Nigeria, these areas offered a promising opportunity. The ongoing developments and strategic location made them ideal for both residential and commercial investments.
Sources: Meritabode, Explorer Homes and Properties, Navigating the Nigerian Real Estate Market
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18) Construction costs for residential properties in Nigeria increased by 7% in 2024 due to inflation and higher material costs
In 2024, construction costs for residential properties in Nigeria rose by 7% due to inflation and rising material costs.
Let's dive into the specifics. The price of cement, a key building material, doubled from N4,000 to N8,800 per bag over the past year. This surge in cost wasn't limited to cement alone. Iron rods, essential for construction, also saw their prices skyrocket from N800,000 to N1,600,000 per ton. Even the cost of paints followed this upward trend, doubling in price.
Inflation played a significant role in this scenario. By September 2024, Nigeria's inflation rate had climbed to 32.70%, up from 32.15% in August. This increase was largely driven by higher transportation and food costs, which inevitably impacted construction activities. Developers faced challenges in managing these rising expenses, causing a slowdown in construction projects.
Despite these hurdles, the real estate market in Nigeria is still growing. The residential real estate sector is valued at a staggering $2.08 trillion. However, the country faces a significant housing deficit, estimated at 27 million units. This deficit is growing at a rate of 20% annually, adding pressure to the already strained market.
For potential buyers, this means navigating a complex landscape. The rising costs and inflation are factors to consider when investing in property. Yet, the demand for housing continues to grow, driven by a rapidly increasing population and urbanization.
Understanding these dynamics is crucial for anyone looking to invest in Nigeria's real estate market. The challenges are real, but so are the opportunities. As the market evolves, staying informed will be key to making sound investment decisions.
Sources: All Africa, Housing TV Africa, School of Estate
19) Short-term rental demand in Nigeria rose by 18% in 2024 due to tourism and business travel
In 2024, short-term rentals in Nigeria surged by 18%, fueled by tourism and business travel.
Major cities like Lagos and Abuja became hotspots for this trend, as many visitors sought temporary accommodations for their stays. Nigeria's growing reputation as a business hub attracted professionals globally, who often preferred the flexibility of short-term rentals over long-term leases. This preference was particularly strong among international organizations and companies, which frequently required temporary housing for employees on short assignments.
The rise in short-term rentals didn't just affect occupancy rates; it also had a significant impact on property values. In prime locations, property owners recognized the potential for higher earnings by opting for short-term rentals instead of traditional leases. This shift was facilitated by digital platforms, which made it easier for property owners to list and manage their rentals, thus enhancing the appeal of short-term options.
These platforms provided a seamless experience for both property owners and renters, contributing to the growing popularity of short-term rentals. As a result, property owners in key areas saw an opportunity to capitalize on the demand, leading to a noticeable shift in the rental market dynamics. The convenience and profitability of short-term rentals became a compelling choice for many, further driving the trend.
With the increase in tourism and business travel, the demand for short-term rentals is expected to continue growing. This trend is reshaping the real estate landscape in Nigeria, offering new opportunities for property investors and owners. The ability to adapt to changing market demands has become crucial for those looking to maximize their returns in the evolving property market.
Sources: ListProperty.ng, 234Intel.com
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.