Average annual rent in Lekki Phase 1 hits N10 million, highest in five years

Lekki Phase 1 has emerged as the fastest-growing residential rental market among Lagos Island’s prime property locations, recording a five-year rent compound annual growth rate (CAGR) of 35.9%, the highest among the four major submarkets tracked.

This is according to the Lagos Island Residential Market Report 2026 by Lagos Realty, which tracks residential rental prices, sales values and land costs across Ikoyi, Victoria Island, Lekki Phase 1 and Ikate between 2022 and 2026.

The report showed that while Ikoyi remained Lagos Island’s premium residential market by rental, home sale and land values, Lekki Phase 1 recorded the strongest rental growth over the five-year period, highlighting sustained demand for residential properties in the neighbourhood.

What the report is saying

The report ranked Lekki Phase 1 as the strongest-performing rental market over the review period, recording a five-year rent CAGR of 35.9%. Victoria Island followed at 33.5%, ahead of Ikate (29.6%) and Ikoyi (22.6%).

• Despite the stronger growth, Ikoyi remained the most expensive rental market, with the average annual rent for a two-bedroom apartment at N17.25 million, followed by Victoria Island (N15 million), Lekki Phase 1 (N10 million) and Ikate (N8.5 million).
• According to the report, Lekki Phase 1 has Lagos Island’s most liquid rental market, supported by the broadest renter base and highest transaction volumes.
• Average annual rents for one-bedroom apartments rose from N2.5 million in 2022 to N7.5 million in 2026. Two-bedroom rents increased from N4 million to N10 million, while three-bedroom apartments climbed from N5 million to N15.5 million, representing a five-year CAGR of 32.7%.
• Four-bedroom apartment rents rose from N5.5 million to N21.5 million, while five-bedroom units increased from N6.5 million to N25.7 million.

The report noted that actual rents vary by project type, unit size, specifications and amenities, with premium gated communities, serviced residences and waterfront developments typically commanding higher prices.

More insights

Beyond the rental market, the report assessed residential sales prices across the four submarkets, with Ikoyi recording the highest average selling price for a three-bedroom home at N674 million.

• Victoria Island followed with an average selling price of N612.5 million, while Lekki Phase 1 averaged N405 million and Ikate N255 million.
• Victoria Island recorded the highest five-year home price CAGR at 25.8%, followed by Lekki Phase 1 at 24.2%, Ikoyi at 21.2% and Ikate at 17.1%.
• Average land prices reached N2.5 million per square metre in Ikoyi, N2.1 million in Victoria Island, N1.5 million in Lekki Phase 1 and N955,000 in Ikate.
• Lekki Phase 1 posted the strongest five-year land price growth at 256%, compared with 198% in Victoria Island, 148% in Ikate and 81% in Ikoyi.

What you should know

The report estimated that more than 30,000 residential units are in the development pipeline across Lagos Island between 2024 and 2027. About 73% are under construction, 18.3% are at the planning stage, while 4.5% are on hold.

• Among the projects highlighted are Declan Residence in Ikate and Quantum Luxury Towers on Ozumba Mbadiwe, Victoria Island, both expected to be completed in 2027.
• The report attributed rising development costs to naira devaluation and global supply chain disruptions, which have increased the cost of imported building materials and made new projects more expensive.

The findings align with a recent Fortren & Company report, which found that Nigeria’s construction costs rose by 20% between December 2025 and May 2026 due to higher material and energy prices. The report added that rising freight costs linked to the Iran-Israel conflict pushed up the prices of cement, steel and finishing materials, forcing some developers to delay projects, renegotiate contracts or scale back project specifications.