Escalating Rent Prices Expose Gaps in Nigeria’s Housing System

Nigeria’s rental market is under mounting pressure as residential rents in Lagos climb by as much as 80–100 percent, stretching the budgets of low and middle-income households. While a handful of areas like Ikorodu, Agege, Alagbado, Egbeda, and Mushin remain comparatively affordable, safety and accessibility concerns continue to shape where people live.

Industry leaders warn that rising rents are only one symptom of deeper structural issues. REDAN and the Nigerian Institute of Architects are calling for stronger regulation, professional oversight, and the activation of the Real Estate Regulatory Council to curb fraudulent development practices and protect the public. They also highlight chronic bottlenecks in land titling, high financing costs, poor infrastructure, and the proliferation of unlicensed practitioners as threats to both affordability and safety.

The Federal Capital Territory Administration has released a sweeping list of 1,095 properties in Abuja that are now subject to enforcement actions over long-standing land charge defaults. The affected titles span high-value districts such as Asokoro, Maitama, Garki, and Wuse, with 835 cases linked to unpaid ground rent and 260 tied to land use conversion breaches and other statutory violations.

The list includes some of Nigeria’s most prominent institutions, including the Central Bank of Nigeria, Nigerian Ports Authority, First Bank, GTBank, BUA International Limited, Ibeto Cement, and major government agencies such as the Federal Ministry of Finance, FHA, NTA, and NSITF. Private developers, manufacturers, schools, and hospitality businesses are also prominently represented.

The Federal Housing Authority has kicked off the development of a new affordable housing estate in Sobawa, Rigachikun, Kaduna State, advancing the Federal Government’s Renewed Hope housing delivery agenda. The project is designed to increase access to safe and affordable homes, particularly for low-income and vulnerable households.

Governor Uba Sani, who led the groundbreaking ceremony, highlighted its alignment with President Bola Tinubu’s Renewed Hope Agenda, which prioritises inclusive housing delivery nationwide. He noted that Kaduna State is pursuing a multi-track strategy that includes partnerships with private developers, targeted social housing schemes, and the provision of serviced land to accelerate construction.

The Central Bank of Nigeria has signalled that monetary easing could begin in 2026, following a sustained decline in inflation and stronger macroeconomic fundamentals. Governor Olayemi Cardoso told stakeholders at the Bankers’ Dinner that inflation fell to 16.05 percent in October 2025, down sharply from 33.88 percent a year earlier. Food inflation also eased significantly, strengthening the case for a shift away from aggressive tightening.

Why It Matters: A potential shift to monetary easing in 2026 would mark Nigeria’s first major policy turnaround in years, with significant implications for households, businesses, and the broader economy. Lower inflation and a possible reduction in interest rates could ease borrowing costs, stimulate private-sector investment, and support consumer spending after a prolonged period of tight monetary conditions.

Nigeria’s public debt increased to N152.39 trillion in the second quarter of 2025, rising by just over 2 percent from the previous quarter. Domestic borrowing accounted for N80.55 trillion, while external debt stood at N71.84 trillion. Lagos recorded the highest domestic and external debt levels among states, while Jigawa and Ondo remained the least indebted.

The latest figures highlight ongoing fiscal pressures as government borrowing continues to rise across both federal and state tiers. With domestic obligations now slightly exceeding external debt, the data underscores Nigeria’s growing dependence on local financing to manage revenue shortfalls and ongoing economic reforms.

Why It Matters: Rising public debt has direct implications for Nigeria’s economic stability and future budget planning. Higher debt levels increase repayment obligations, reduce fiscal flexibility, and limit the government’s ability to invest in critical sectors such as housing, infrastructure, and social services.

For households and businesses, sustained debt growth can lead to tighter monetary conditions, more cautious public spending, and higher future taxes or service charges. The trend also raises concerns around long-term sustainability, especially if revenues do not rise fast enough to match borrowing.

Nigeria’s commercial property market recorded a major rebound, with acquisition volumes rising to about US$336 million according to the Northcourt 2025 Commercial Real Estate Outlook Report. This represents a significant jump from the previous year and signals renewed investor confidence despite wider economic pressures.

The report attributes the surge to improved capital inflows, stronger demand for Grade A offices, and increased activity around mixed-use developments. Analysts warn, however, that sustained growth will depend on transparency, governance, and improved macroeconomic stability.

A new lifestyle-focused retail and leisure development has opened in Awoyaya, Lagos, targeting the rapidly growing Ibeju-Lekki corridor. The project introduces a mix of retail outlets, hospitality spaces, entertainment zones, and boutique apartments, reflecting the rising demand for integrated live-work-play environments.

Developers behind the project emphasised that the mall is designed to serve the expanding middle-income population and support the area’s transformation into a major residential and commercial hub.

A new market analysis highlighted a shift in corporate leasing preferences, with companies prioritising smaller, more flexible office spaces to reduce costs while maintaining operational efficiency. The trend is most visible in Lagos and Abuja, where demand for mid-sized and co-working spaces has increased.

According to the findings in the 2025 Corporate Real Estate Adaptation Report, firms are also adopting hybrid work models, pushing landlords to redesign floor plans, upgrade facilities, and reposition older buildings to stay competitive.

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_{^{Produced by: Amarachi Okeke}}