Lagos is not the capital of Nigeria (it is Abuja). But it is still the most important city in this African country of 150 million people. Lagos still remains the commercial capital of Nigeria with all major industries operating from there. Nearly 15 million people live in this city where real estate prices are touching the sky. Here are 5 facts about real estate in Lagos that will amaze you.
Higher rent than Los Angeles and NYC
Rent for a 3 bedroom apartment in some area in Lagos can go up to $75000 per annum. If this is not enough, some landlords ask for payment of 2 years’ rent upfront at the time of moving in.
It is very costly to build a home in Lagos
Buying a piece of land and constructing a house of it is a lengthy and very costly affair in Lagos. Underdeveloped infrastructure in terms of electricity and drinking water makes it almost 300% more expensive than U.S. to build a house in Lagos. This is a fact that not many people believe. But they learn it the hard way when they try to build a house for themselves in Lagos.
Acute shortage of houses
Lagos is the commercial capital inspiring people from villages to migrate here in search of employment. The population of Lagos is swelling with nearly a quarter of a million people joining it every year. It is natural for these people to find it difficult to own or rent homes in Lagos. NMRC, the state housing finance company, provided finance to help in the construction of 10000 homes whereas it received 66000 applications last year. This reflects the acute shortage of housing being faced by people of Lagos.
Prices touching the roof
Lagos remains the costliest city in Nigeria. The cost of a 3-4 bedroom house in Lagos is around NGN75 million to buy depending on the location which comes to about $239000.
Demand for homes is declining
This is really a strange fact about Lagos real estate. Even though there is a crisis of housing for people in Lagos, demand for homes is shrinking. This is reflected in declining property prices with few takers. To spur the demand, some steps were taken by the government These include cut in consent fees (from 6% to 1.5%) and decrease in capital gains tax rate from 2% to 0.5%.