Nigeria's housing market stabilizing, amidst improving economic conditions
Updated: Nov 18, 2019
After three years of house price falls, Nigeria's property market is now stabilizing, mainly driven by improving economic conditions. House prices were almost unchanged, amidst steady demand.
“The residential real estate market in 2018 was without significant changes in prices compared to the previous year,” said Nigeria-based online real estate firm, PropertyPro.ng.
However, this masks local house price movements. Ikoyi, the most affluent neighborhood of Lagos, registered the highest y-o-y house price growth of 20% in May 2019, followed by Ibeju Lekki, with annual price increase of 12%, based on figures from the Nigeria Property Centre. House prices in Lekki, Ajah, Gbagada, Surulere, and Yaba were largely steady.
On the other hand, Ikorodu saw the biggest decline in house prices of 25% during the year to May 2019, followed by Ikeja (-16.7%), Alimosho (-10.7%), Isolo (-9.1%), and Victoria Island (-8.7%).
Lagos is the most expensive city in Africa. In Ikoyi, the average price of three-bedroom apartments was NGN 140 million (US$388,906) in H2 2018 while five-bedroom apartments are sold for an average price of NGN 350 million (US$972,266).
In other popular areas outside Lagos:
Abuja, the capital city of Nigeria, is experiencing increasing interest from both local and foreign investors. In Maitama, an upscale neighborhood in Abuja, the average price of four-bedroom apartments was NGN 213 million (US$591,693) while five-bedroom apartments were sold for NGN 350 million (US$972,266) in H2 2018.In Rivers, the average prices of three- and five-bedroom apartments were NGN 40 million (US$111,116) and NGN 75 million (US$208,343), respectively.In Oyo, the average prices of three- and five-bedroom apartments were NGN 13 million (US$36,113) and NGN 40 million (US$111,116), respectively.In Ogun, the average price of three-bedroom apartments stood at NGN 11.5 million (US$31,946) while it was NGN 30 million (US$83,337) for five-bedroom apartments. The housing market will continue to stabilize this year, with house prices and residential rents expected to either remain stable or rise modestly this year, according to local property experts.
In 2018, Nigeria's economy expanded by 1.9% in 2018, an improvement from a minuscule growth of 0.8% in 2017 and a contraction of 1.6% in 2016, buoyed by improvements in manufacturing and services, supported by the continued recovery in the oil sector, according to the International Monetary Fund (IMF). The economy is projected to improve further, with growth forecasts of 2.1% this year and 2.5% in 2020, based on IMF estimates. But the Central Bank of Nigeria is more optimistic, projecting a 3% growth this year.
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