A Deepening Housing Crisis
The housing crisis in Nigeria has reached unprecedented levels, leaving millions of city dwellers struggling to afford decent accommodation. Rising macroeconomic pressures, including inflation, high construction costs, and foreign exchange volatility, have pushed rental prices beyond reach for many urban residents. With an estimated 28-million-unit housing deficit, Nigeria’s real estate market is experiencing a severe supply-demand imbalance that continues to fuel skyrocketing rents.
Surging Rent Prices in Major Nigerian Cities
Over the past year, rent in Nigeria’s commercial hubs has surged by over 100%, forcing many tenants to either downsize, relocate to the outskirts, or face severe financial strain. In cities like Lagos, Abuja, Port Harcourt, Ibadan, and Kano, housing affordability has deteriorated, leaving renters with limited options.
Lagos:
- Two-bedroom apartments previously rented for ₦500,000–₦700,000 now cost ₦1.2 million–₦1.5 million.
- Three-bedroom units that used to cost ₦800,000–₦1 million now range between ₦1.5 million and ₦2.5 million.
Abuja:
- A four-bedroom duplex rents for as high as ₦15 million.
- A three-bedroom apartment now costs ₦6 million.
- Two-bedroom flats have jumped to between ₦5 million and ₦12 million.
Port Harcourt:
- A two-bedroom flat now costs ₦2 million–₦3.5 million.
- Mini-flats that were previously ₦300,000–₦400,000 now go for ₦500,000–₦600,000.
Akure:
- Rent for a standard two-bedroom flat has increased from ₦400,000 to ₦500,000.
- Many residents are moving to cheaper areas where rent ranges between ₦300,000 and ₦350,000.
With Nigeria’s national minimum wage at ₦70,000, most urban dwellers find it impossible to afford these rates, leaving them vulnerable to financial hardship and homelessness.
The Role of Inflation and Construction Costs
A major driver of this crisis is inflation, which has significantly increased the cost of construction materials such as cement, steel, and fittings. Developers, in turn, have raised property prices, making homeownership unattainable for many Nigerians. Some key inflationary pressures include:
- Foreign exchange volatility, which has made it more expensive to import construction materials.
- High borrowing costs, making it difficult for real estate developers to finance new projects.
- Rising maintenance costs, which landlords use to justify rent hikes.
Without intervention, these cost burdens will continue to push property prices higher, further squeezing both renters and prospective homeowners.
Lack of Affordable Housing Supply
Despite Nigeria’s growing population and increasing urban migration, housing supply remains critically low. The government and private developers produce fewer than 100,000 new housing units annually, a fraction of what is needed to address the growing demand.
The major barriers to housing development include:
- Inadequate infrastructure: Poor road networks, unreliable electricity, and limited water supply make construction projects expensive and slow.
- High cost of land acquisition: Developers struggle to secure affordable land in prime locations.
- Regulatory bottlenecks: Lengthy approval processes discourage investment in housing development.
The Failure of Rent Control and Market Exploitation
Efforts to implement a Rent Control Law have stalled, allowing landlords to increase rents arbitrarily without making improvements to properties. Many property owners justify rent hikes by pointing to inflation and maintenance costs, but in reality, a lack of regulation has enabled market exploitation.
According to Stephen Sobo, a Lagos-based property manager, rental prices have gone “beyond normal,” making it difficult for even middle-class earners to find affordable housing. For example:
- A three-bedroom flat that was ₦1.5 million now costs ₦2.5 million–₦3 million.
- A five-bedroom duplex that was ₦150 million now requires ₦240 million to buy.
- Studio apartments that were ₦30 million now sell for ₦55 million.
As landlords capitalize on rising demand, low-income renters are left without viable housing options, deepening Nigeria’s housing inequality.
Who is Most Affected?
- Low and middle-income earners who cannot afford rent increases.
- Millennials and Gen Z professionals who are shifting toward hybrid work and seeking affordable studio apartments.
- Civil servants who are unable to meet rising rental costs due to stagnant salaries.
Many of these groups are now forced to relocate to less developed areas with lower rent but poor infrastructure and security.
Sustainable Solutions to Nigeria’s Housing Crisis
Experts argue that Nigeria must adopt long-term solutions to stabilize the housing market and improve affordability. Key recommendations include:
- Government Intervention and Subsidies
- The government must prioritize housing as a social service by providing subsidized housing for low-income earners.
- Policies should focus on reducing import duties on construction materials to lower development costs.
- Incentives for Private Developers
- Offering tax incentives to private developers can encourage the construction of more affordable housing units.
- Public-private partnerships (PPP) should be strengthened to fund large-scale housing projects.
- Expansion of Mortgage Facilities
- Mortgage financing should be made more accessible to middle-class earners.
- The government should introduce low-interest mortgage loans to help renters transition to homeownership.
- Infrastructure Development
- The government must invest in better road networks, electricity, and water supply to make suburban areas more liveable.
- Upgrading urban infrastructure will reduce pressure on city-center housing markets.
Conclusion: Urgent Action is Needed
Nigeria’s housing crisis will continue to worsen unless the government and stakeholders take urgent action. Rent prices have already reached unaffordable levels, pushing many into financial distress and informal housing arrangements. Without affordable housing projects, improved infrastructure, and mortgage reform, millions of Nigerians will remain trapped in a cycle of rising rents and diminishing purchasing power.
People who had the chance to become land and home-owners in the past years, but hesitated are now having regrets about their indecisions. Prices of lands, houses, and other commodities may continue to soar even more than the past years.
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