Lagos needs N6 trillion annually to fix housing crisis, GTI Capital Research shows

Lagos requires about N6 trillion annually to bridge its housing capital gap, as the state’s housing deficit has risen to 3.4 million units, according to findings presented at a housing and capital forum organised by GTI Group Ltd on Thursday, August 20, 2026.

Prof. Timothy G. Nubi, Founding Director, University of Lagos Centre for Housing and Sustainable Development, disclosed this in a keynote presentation titled “Housing, Capital and the Future of Lagos” at the forum themed “Beyond Rent: A Lagos Housing and Capital Forum.”

The forum brought together stakeholders from government, housing, real estate, investment and economics to examine how capital could be mobilised to address Lagos’ housing and affordability challenges.

Speakers included Engr. Abdulhafis Gbolahan Toriola, Permanent Secretary, Lagos State Ministry of Housing; Dr. Bola Adigun, West Africa Government and Public Sector Leader and Economics Leader at Deloitte; Mr. Tolu Bawa-Allah, Managing Director, Prindex Properties; and GTI Group Managing Director, Mr. Abubakar Lawal.

Others included the Managing Director, GTI Capital Ltd, Mr. Kehinde Hassan; Group Executive Officer, Mr. Olusegun Olawoye; Finance Director, GTI Investment Group, Mr. Adigbemi; and GTI Capital Head of Research, Mr. Abiodun Ogunniyi.

What they are saying:

Nubi said Lagos’ housing deficit increased from 2.95 million units in 2016 to 3.4 million units in 2025, representing a 15% increase over nine years, which confirms  Nairametrics report.

• “Lagos has become Africa’s economic capital, but its housing system has failed to convert economic growth into affordable living and wealth creation,” Nubi stated.
• “Lagos state requires approximately 227,576 new housing units annually to meet demand, as population growth and increasing migration continue to outpace housing supply.”

According to Nubi, Nigeria’s pension funds hold about N30 trillion in assets and are permitted to allocate up to 30% into Real Estate Investment Trusts (REITs), mortgages and asset-backed securities, yet actual allocation to housing-related instruments remains around just 5%.

This underinvestment persists even though Nigeria’s real estate market was estimated at $2.42 trillion in 2024, with residential real estate alone accounting for $2.08 trillion, and even as real estate contributes only about 0.5% of Nigeria’s GDP, compared with 18%–20% in the US and UK.

The professor argued that the scale of the challenge means government cannot build its way out of the housing crisis alone, stressing the need for private developers, mortgage finance, institutional investors and capital-market funding.

He argued that housing needs to shift from being viewed as a physical product to becoming an institutional investment asset, channelled through REITs, bonds, asset-backed securities, crowdfunding and mortgage innovation, pointing to how real estate has historically supported economic transformation in countries including Brazil, Taiwan, the UAE, Russia, China, Indonesia and South Africa.

More insights:

Presenting “Beyond Rent: Mapping Lagos’ Housing-Led Capital Expansion,” Ogunniyi framed the housing crisis as more than a shortage of homes, describing it as a capital allocation, affordability and infrastructure-pricing problem.

He said rents across Lagos increased by between 80% and 120% from 2024 to 2026, while wages grew by only 7% to 9% over the same period.

According to the research, infrastructure has become the biggest factor determining property prices across the 15 zones analysed, while Lagos’ property price-to-income ratio stood at 19.2 times, significantly above the 5.0 times threshold regarded as severely unaffordable.

Ogunniyi estimated the annual housing capital gap at N6 trillion, equivalent to about three times Lagos State’s entire capital budget, pointing out wide variations in rental costs across the metropolis.

• In Ikoyi, annual rent for a two-bedroom apartment was estimated at between N8 million and N70 million, with an average field-survey figure of N30 million. Victoria Island recorded a range of N3 million to more than N50 million, with an average of N18 million.
• For Yaba, Surulere and Ikeja, the estimated range was N1.5 million to N12 million, with an average of about N4.75 million to N5 million, while Lekki Phase 1 recorded rents ranging from N1 million to N40 million, with an average of N15 million.
• In Ajah and Sangotedo, the average was about N3 million to N3.5 million, while Ikorodu and Badagry recorded significantly lower averages of between N480,000 and N1.08 million.

The research highlighted the growing pressure on household incomes, particularly among low- and middle-income earners.

It found that some Lagos residents spend between 60% and 70% of their income on rent.

• A two-bedroom apartment could consume 29% of the income of a worker earning N1 million monthly, 58% for someone earning N500,000 and as much as 97% for a person earning N300,000 monthly.
• For low-income earners earning N70,000 monthly, housing costs could account for between 36% and 119% of income, even in peripheral areas such as Ikorodu.
• Similarly, a worker earning N500,000 monthly could still spend 40% to 60% of income on rent in locations such as Yaba and Surulere.

Ogunniyi said the mismatch between rent and wages had transformed Lagos’ housing challenge into a broader capital-market and financial-inclusion problem.

Can Nigerians afford to buy?

The GTI Capital research, which was launched at the event, also examined the affordability of home ownership using a 9.75% mortgage rate, 20-year tenor and 10% equity contribution under the MREIF framework.

• It estimated that low-income earners could afford properties below N3.51 million, lower-middle-income earners could afford between N3.51 million and N8.79 million, middle-income earners between N8.79 million and N29.87 million, while upper-middle-income earners could afford properties valued between N29.87 million and N105.42 million.
• The findings suggest that even subsidised mortgage financing remains largely inaccessible to lower-income households.

This, Ogunniyi said, means Nigeria’s housing problem is also a financing-exclusion problem. The presentation also called for greater use of capital-market instruments to finance housing, including Real Estate Investment Trusts (REITs), bonds, asset-backed securities, crowdfunding and mortgage innovations.

Lagos Government Representative responds

Responding to issues raised by participants, Toriola said the Lagos State Government is creating the enabling environment for housing development and other economic engagements, pointing out that the Lagos State Real Estate Regulatory Authority (LASRERA) was established to regulate the sector and provide an avenue for resolving disputes involving developers and other stakeholders.

He explained that developers operating in Lagos are required to register, while LASRERA can mediate issues involving land, permits, and interactions with government agencies.

According to him, developers must obtain the necessary permits before commencing construction to avoid enforcement actions that could result in delays and higher project costs.

Toriola also urged prospective land buyers to conduct proper searches before purchasing property and completing their surveys and documentation.

He said the state was also looking into issues surrounding the Land Use Act of 1978, which he acknowledged requires review.

The Permanent Secretary further disclosed that developers face significant cost implications when construction is delayed because building-material prices remain dynamic.

What you should know:

Experts have increasingly called for greater institutional financing, including pension funds, REITs and mortgage-backed instruments, to channel long-term capital into housing development and expand supply.

• Nairametrics had previously reported that Lagos’ housing deficit reached about 3.4 million units in 2025, and the city requires 227,576 new homes annually to keep pace with population growth and replace dilapidated stock.
• Rents have risen sharply as inflation, higher construction costs, naira depreciation, limited supply and strong demand continue to push landlords and agents to review prices upward.
• The widening gap between rents and incomes has increased affordability pressures, with some households forced to remain in overcrowded or informal housing as formal rental options become increasingly expensive.
• The forum highlighted reforms being implemented by the Lagos State Government, including the state’s digital e-platforms for development approvals and land-related transactions using seamless digital channels for approval and land-registration initiatives.

According to Prof. Nubi, the government had invested not less than N8 billion in its approval platform to make the process more seamless. However, the effectiveness of these reforms would depend partly on public awareness.