Following rising demand for commercial space and housing for middle-income and young professionals in Nigeria, the nation’s real estate market has continued to grow with the sector now valued at N6.4 trillion ($41.2 billion).
According to a report by Agusto & Co., the Lagos sub-segment of the market accounts for at least 40 per cent of the Nigerian market.
Growth, the report revealed, continues to be driven largely by new to market residential and commercial properties in Lagos, Abuja and Port Harcourt.
The report estimates the market to grow by an estimated average of 10 per cent in 2014 and 2015 respectively.
Rent and yields
Rentals and sales prices, the report, revealed, were higher in the prime market compared to the mainland market.
According to the report, typical rental for a 3-bedroom luxury residential property was highest in Ikoyi at an average of â‚¦10.4 million ($65,000) per annum, with a rental yield of 9.9 per cent. Conversely, rental price changes were prominent in the mainland market, with Surulere recording a high cumulative rental price change of 29 per cent from January 2011 to April 2014.
It further stated that sale prices were also highest in the Ikoyi sub-market, with the price of a 4-bedroom detached house on a 2000m² land trending up to â‚¦856 million in the first half of 2014. Land prices in Lekki and Victoria Island reported the largest cumulative change of 23 per cent and 22 per cent respectively between 2011 & 2014. The Ibeju-Lekki development plan remains a strong driver of land and property price changes in the areas.