Lagos State has remained the best place to invest in real estate in Nigeria for many years. This is evident in the GDP report by the National Bureau of Statistics, which confirms Lagos as the most active state in the Nigerian real estate industry. Many people have made fortunes from investing in the Lagos real estate market.
Here are six reasons why you should also invest in this goldmine:
1. Ever-Growing Population and High Housing Deficit Numbers:
Lagos is the smallest but most populous state in Nigeria. It has grown from just 1.4 million inhabitants in 1970 to approximately 15.4 million people currently. Lagos has a population density of about 5000 people per square kilometer, making it one of the most densely populated cities in Africa.
It is estimated that about 86 people migrate to Lagos every hour, making it more than 2000 people every day and about a million people every year. This ever-increasing population is estimated by the World Bank to double by 2050. Also, with 1.49 million formal housing units currently available, the housing deficit for Lagos is at 3.2 million.
This population growth, coupled with the housing deficit, leaves a certain demand-supply gap to be exploited.
2. Economic and Industrial Hub of Nigeria:
Lagos is Nigeria’s richest state, with a GDP of around US$33.67 billion, accounting for 25% of the country’s overall GDP. It is Africa’s fifth-largest economy, with over 2000 manufacturing businesses, 200 financial institutions, and one of the greatest concentrations of small and medium-sized industries on the continent. Lagos uses more than half of the country’s energy, contributes to more than 90% of Nigeria’s international commerce flow, and handles 80% of all Nigerian imports.
According to market data, Lagos State has the highest property prices and the most active real estate market in Nigeria.
3. Growing Middle-Class Population:
Lagos’s vibrant economy has led to a growing middle-class population with money to spend on luxuries and decent accommodation. The middle segment of the housing market remained robust despite the economic headwinds experienced by every other sector of the Nigerian economy, and this has been attributed to strong demand from the middle class. Lagos has the largest share of the working population in Africa.
4. Fast-appreciating property values:
Because of the high rate of return on investment, Lagos is a dream destination for real estate investments. When property prices in other states throughout the country fell due to the recent economic crisis, the Lagos property market, particularly the mid-market segments, remained robust. For example, the rental value of most properties in the state has more than doubled over the past five years.
5. Strong Rental Market:
Rising property and rental prices reflect the massive supply-demand gap for affordable housing in Lagos. Due to the excessive cost of purchasing and registering secure land titles in Lagos’ highbrow areas, and the poor mortgage system in the country, the Lagos property market has more renters than owners. A study shows that over 75% of property seekers are looking for rental accommodations.
6. Stable Political Environment:
When compared to other states in Nigeria, Lagos has the most stable political environment. Since the restoration of democracy in 1999, Lagos has been governed by the same political party, ensuring continuity in government. This is beneficial to the real estate market since projects and developments are carried out per the master plan. It also implies that critical initiatives that support growth will not be sacrificed on Lagos’s population is expected to double by 2050, making it the world’s third-largest city. The growing population would require accommodation, making real estate investment in Lagos State a no-brainer given its predicted 3.2% annual population growth rate paired with a 16% urbanization growth rate. Steady and persistent demand for homes ensures that prices will continue to rise, while smart investors will continue to profit handsomely. The best time to buy real estate is now.
CONCLUSION
Lagos’s population is expected to double by 2050, making it the world’s third-largest city. The growing population would require accommodation, making real estate investment in Lagos State a no-brainer given its predicted 3.2% annual population growth rate paired with a 16% urbanization growth rate. Steady and persistent demand for homes ensures that prices will continue to rise, while smart investors will continue to profit handsomely. The best time to buy real estate is now.
