Stakeholders in Nigeria’s housing sector have warned that the country’s rapidly growing population, coupled with limited land availability and weak government policies, is fuelling a surge in housing costs and worsening affordability for ordinary citizens.
They emphasised that investment-friendly policies are crucial to attract and retain private capital into the sector and create an enabling environment for real estate development to thrive, an action they note would ultimately make housing more affordable for the average Nigerian.
Speaking in Abuja on Tuesday, Ajayi Frank, explained that the dynamics of population growth and land scarcity are reshaping the housing market and pushing prices higher across urban centres.
“The basic economics of buying and selling is driven by demand. Demand drives pricing. The truth is that we have a large population and limited land. Our land is not going to expand in five years from now. That’s the truth. So, with the increase in population will come more demand for property, more demand for space , and that makes it more valuable. So that’s naturally what will happen,”Franklin said.
He added that while rising demand is inevitable, affordability can still be achieved through deliberate interventions addressing the structural challenges in the sector. “To make housing more affordable, we basically have to start looking at every aspect, from the cost of building materials to government policies and laws. These are the factors that will encourage or help bring down or mitigate some of the challenges that not just developers but also home buyers go through to actually have a decent home over their head’, he said.
Franklin advised that the government strengthen its policies and make them investor-friendly,” Franklin said,noting the the government cannot afford to actually fund “the huge housing deficit alone.”
“So if the private sector is investing money, then make it easy for them. When you make it easy for them, you can now come back and insist on lower housing costs. But when you have not helped, you cannot demand from where you have not really invested. The average developer still goes to the market and buys the land at exorbitant prices”, he urged.
He further argued that regulation is necessary to protect low- and middle-income earners from being priced out of the market. “There has to be some level of regulation at some point, so that the common man can truly afford decent housing,” he said.
According to him, Nigeria’s property sector now contributes a larger share to GDP than the oil and gas industry, over 40 percent contribution . He urged developers take the business seriously.
Speaking on behalf of the Real Estate Developers Association of Nigeria (REDAN), Binta Ibrahim, Chairperson of the National Women Developers Committee said making homes affordable would require targeted government subsidies and stronger collaboration among stakeholders.
“Building affordability will only come if there’s any kind of subsidy from government, because we’re going to the same market,” she said.
Ibrahim however informed that REDAN is taking steps to address rising construction costs through partnerships with key industry players such as the cement industry.
“We are trying to engage the building society so that when we come together, we will get all our materials at an affordable rate. We are trying to engage the cement companies”, she said.
Ibrahim emohasised that effective government policy remains essential to stabilising the sector. “ These are growing concerns for the private sector. Government should try to look at putting in policies that will be friendly to the environment and to the sector in particular”, she urged.
