The Affordability of Owning Property in Nigeria

One of the appealing aspects of the Nigerian housing market is the a ordability and accessibility of homes. While 2020 saw a dip in the housing market globally before Covid- 19, Nigeria was on the path to signi cant changes in its housing market. 2019 saw a tremendous surge in demand for property, with a 72% increase in online searches for housing in the country. Many believe the previous year’s issues are only a blip, and the market will continue to grow. Here are a few reasons why Nigerian housing is a ordable and should interest you.

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6/24/2021 The Affordability of Owning Property in Nigeria | Adefunke Sharon Kasali | Business and Career

With the transition towards working from home, people have expressed a need for larger spaces for comfort. The need for an o ce in your home has never been greater. Plenty of Millenials and Gen Z-ers are disinterested in strictly working from the o ce, and it’s led some to speculate a change toward more signi cant interest in property ownership. If this younger generation is saving money by living at home and spending less on travel and food, it could a ord the house to be the space worth investing your time and money. Some hope that the stimulus package passed in June of 2020 will continue to help invigorate the market.

Favorable to Landlords

Renting in Nigeria has a variety of bene ts, particularly for the homeowner. This makes it an engaging proposition for those looking to make money o of real estate. Rental income tax is meager. Non-residents only have to pay a gross rental income of 10% on their leased out properties. Further, the Capital gain’s tax for the property sale is also only 10%, with all upgrades to the house-made deductible. Finally, and most lucratively, there is no inheritance tax on property. This makes property ownership a pro table venture and could a ord the opportunity to create generational wealth through land ownership. Sometimes rent can be paid 2-3 years in advance, and in Lagos, it is particularly easy to ll vacancies. The market is rmly pro-landlord, which is what makes ownership such a potentially pro table proposition.

Sustained Growth

Within the last decade, Housing Markets have seen sustained growth, which has allowed them to grow into a more signi cant in uencer of Nigerian Economics. In 2010, housing produced just 3.37% of Nigeria’s Gross Domestic Product. But by 2017, Nigeria’s housing market made up 6.79% of Nigeria’s GDP. This is a steady and consistent growth for seven years and indicates that housing is of increasing importance to Nigeria’s economic wellbeing. As fossil fuels continue to take losses worldwide, the investment in infrastructure and accommodation might be all the more valuable moving forward.

Nigeria is in a state of growth and change. Traditionally, development has also meant seeing gains in the signi cance of the property in a nation. A populace that is housed and settled is a happy one. There is plenty of room for more housing to support the people of the country, and keeping it a ordable while sustaining its worth as an investment will be critical to the continued development of the nation.