To check sharp practices in Nigeria’s real estate sector, the Federal Ministry of Housing and Urban Development is pushing to regulate and license estate agents and property developers. However, with some states and professional regulatory bodies already performing similar functions, experts argue that harmonisation, rather than regulatory duplication, is the way forward, VICTOR GBONEGUN reports.

The Federal Government’s plan to introduce a new regulatory framework for Nigeria’s housing and real estate sector has rekindled concerns among industry stakeholders over possible duplication of roles, bureaucratic bottlenecks and conflicts with existing laws and institutions.

While proponents of the proposed framework argue that stronger regulation is needed to protect homebuyers, investors and other market participants, professionals in the property sector are questioning whether the initiative will address existing regulatory gaps or add another layer to an already crowded system.

The concerns come against the backdrop of a real estate market governed by multiple laws, agencies, professional bodies and state-level regulators, with overlapping responsibilities in areas ranging from land administration and development control to property transactions, valuation, planning and consumer protection.

According to the National Bureau of Statistics, real estate contributed about 5.2 per cent to 6.1 per cent to the Gross Domestic Product (GDP) as of Q1 2026. The Federal Government said real estate contributes about 13.4 per cent of GDP, estimated at N41 trillion. In contrast, real estate and construction together were valued at more than N77 trillion last year, with potential to attract funds yearly through diaspora remittances.

The sector provides job opportunities for developers, architects, estate surveyors, agents, property managers, bricklayers, carpenters, plumbers, cement sellers, truck drivers, and furniture makers. The Guardian survey of the sector revealed that there has been a surge in fraud practices reported to the Economic and Financial Crimes Commission since 2022 to date.

In the past two decades, many qualified and unqualified operators in the sector have abused the opportunities, breeding a trust deficit. There have been cases of fraudulent developers and housing agents who swindled prospective homebuyers and Nigerians seeking accommodation of millions of naira across the major cities of Lagos, Abuja, Rivers, Ogun, Ibadan and others.

The proposed National Housing and Built Environment Regulation Policy is one of the most ambitious attempts to bring greater order to the property market. Among other measures, it proposes mandatory licensing of property developers and estate agents, compulsory escrow arrangements for buyers’ funds, registration of professionals, enforcement of the National Building Code, improved land administration and a national housing data centre.

The Minister of Housing and Urban Development, Dr Muttaqha Darma, has also proposed a National Housing Industry Regulatory Commission to oversee the sector. The proposals were presented during a stakeholders’ validation workshop on the National Housing Data Programme and regulation of the built environment in Abuja.

The intention is difficult to fault as Nigeria’s property market has long suffered from fraudulent transactions, unlicensed practitioners, abandoned developments, weak project monitoring, title disputes, misleading advertisements and limited avenues for homebuyers to recover funds.

But the proposed reforms could run into a different problem as Nigeria already has several laws, institutions, professional bodies and state agencies regulating different parts of the property value chain. The danger, therefore, is that a reform designed to close regulatory gaps could instead produce overlapping mandates, multiple licences, duplicated fees and competing enforcement authorities.

Under the Land Use Act, land in each state is vested in the governor and, subject to the Act, urban land is under the control and management of the state governor. The law also gives local governments responsibilities over non-urban land.

Physical planning and development control also operate across federal, state and local government levels. The Nigerian Urban and Regional Planning framework provides for development-control departments at the different levels, with federal control applying to federal lands, state control to state lands and local authorities exercising powers within their jurisdictions. Development generally requires approval from the relevant planning authority.

This means that a federal licence for a developer cannot simply become a substitute for state planning approval, title documentation, development permits or other approvals. The proposed federal system must therefore answer a fundamental question: what exactly will the new regulator regulate? If it is licensing developers and agents, how will that function relate to existing professional regulation and state-level real estate agencies?

Consequently, a new federal licensing system must distinguish between regulating a professional practice and regulating a broader class of property intermediaries. That distinction matters because thousands of people operate in Nigeria’s property market as estate agents without being registered estate surveyors and valuers.

It is precisely this gap that has created the strongest argument for intervention. A 2024 The Guardian analysis found that unregulated estate agents remained one of the sector’s major weaknesses, with experts pointing to poor professional standards, excessive charges and cases involving clients’ funds.

The call was for stronger certification and enforcement.

The policy challenge is therefore not whether estate agencies need greater oversight. It is how to achieve it without creating a second regulatory structure for professionals already regulated by law.

Nigeria has already experienced the friction that can arise when state regulation intersects with federal professional regulation. Lagos introduced its estate agency regulatory framework to register practitioners, investigate complaints, sanction unlicensed operators and improve transparency in property transactions. The initiative was partly driven by the need to eliminate fraudsters and impostors from the market.

But the move generated objections from the Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON) and the Nigerian Institution of Estate Surveyors and Valuers (NIESV), which argued that registered estate surveyors and valuers were already regulated under federal legislation. The disagreement illustrates the problem the Federal Government now faces at the national level.

This could be particularly important in a market where developers sometimes rely heavily on subscribers’ funds to finance construction. Escrow, if properly designed, could ensure that buyers’ money is not immediately diverted to unrelated projects and that funds are released as agreed construction milestones are achieved.

If developers are required to lock buyers’ money in escrow while also confronting high interest rates, volatile construction costs, foreign-exchange pressures and expensive building materials, the policy could affect project financing and ultimately increase the price of housing.

Acting Chairman of the Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON), Prof. Dugeri Terzungwe, lamented that Nigeria has continued to grapple with lawmaking, with a preponderance of laws sometimes enacted without recourse to existing legislation to determine whether similar laws are already in place.

Terzungwe said sub-national governments were often guilty of enacting laws without adequately considering existing federal legislation, stressing that state laws could not supersede federal laws.

He said the situation was particularly problematic in estate agency because professionals were already legally empowered to undertake agency as part of estate surveying practice.

Terzungwe argued that the Federal Government’s proposed regulation should focus on removing non-professionals from estate agency and allowing regulated professionals to operate in the sector.

He said ESVARBON already had the power to discipline its members for misconduct, adding that introducing another layer of regulation without recognising the existing statutory framework could create conflict.

“You don’t just reinvent what already exists. All manner of laws, even at the federal level, and most of them at the sub-national level, are duplicating rules, and this will cause conflict,” he said.

Terzungwe emphasised that estate agency was part of estate surveying and was covered by ESVARBON’s regulatory mandate, adding that the board could sanction members found guilty of misconduct in the practice of estate agency.

The Real Estate Developers Association of Nigeria (REDAN) had in recent times moved to regulate the sector through a bill at the National Assembly under the leadership of the immediate past president, Dr Aliyu Wamakko. He said the failure to sign the bill represented a missed opportunity to regulate the sector.

Also, the REDAN President, His Royal Majesty Akintoye Adeoye, told The Guardian that the key issue was not whether developers should be regulated but how the system should be structured and responsibilities shared.

Adeoye, a lawyer, said the major challenge was not necessarily the absence of a database of developers but the lack of trust, accountability and mechanisms to establish whether operators were competent, solvent and honest.

According to him, Nigerians have lost money through collapsed off-plan schemes, multiple sales of the same property and abandoned developments, while fraudulent operators often escape without consequences. He said credible regulation would help distinguish legitimate developers from fraudulent operators and protect the reputation of responsible developers.

Adeoye said, “If the government does not know who the developers are, then a database can solve that. We can build one in six months. But I do not believe that is the real problem. The real issues are trust and accountability. Nigerians have watched off-plan schemes collapse, the same plot of land sold to multiple organisations, individuals and families, and subscribers’ money disappear into projects that never progressed beyond the foundation stage, if they started at all. They have also watched buildings collapse and claim lives.

“Those Nigerians did not suffer because the government lacked a list of developers. They suffered because the system failed to establish whether those collecting their money were competent, solvent, honest and accountable.”

He assured that REDAN was ready to work with the Ministry of Housing and Urban Development to regulate the sector, warning that leaving the industry unregulated would encourage corruption, malpractice, non-compliance with laws and ethical breaches.

However, he urged the ministry not to duplicate the functions of existing professional bodies. He proposed that the Federal Government should handle licensing and recognition of developers, while REDAN should take responsibility for professional development, with its certification serving as a condition for federal licensing.

On sub-national regulation, Adeoye said states should continue to make and enforce laws governing land, planning and development control within their jurisdictions, while federal regulation should provide a framework in states where such laws do not exist.

He maintained that this arrangement would not amount to over-regulation if the responsibilities of each level of government were clearly defined.

The REDAN president further noted that professionals in the built environment were already regulated by statute, citing the Architects Registration Council of Nigeria (ARCON), Council for the Regulation of Engineering in Nigeria (COREN), Council of Registered Builders of Nigeria (CORBON), Town Planners Registration Council of Nigeria (TOPREC), Quantity Surveyors Registration Board of Nigeria (QSRBN), Surveyors Council of Nigeria (SURCON) and ESVARBON.

Adeoye called for a coordinated framework under which the Federal Government provides the legal authority, statutory regulators handle licensing and enforcement, states retain responsibility for land, planning and development control, professional bodies regulate their respective professions, and REDAN focuses on training and professionalising developers.

However, the Chairman of the Association of Estate Agents in Nigeria (AEAN), Olugbenga Ismail, described the Federal Government’s move as a positive step, saying regulation was necessary to establish minimum standards and clear operating rules in the industry.

Ismail said the government should serve as the referee in the property market, particularly where existing professional bodies regulate their members but do not cover all actors operating between developers, professionals and consumers. “So, the government will be the referee in the marketplace.

It’s not going to be double regulation,” he said.

He explained that while states would continue to exercise their responsibilities under the Land Use Act, the ministry could establish national standards, with the federal framework applying in states without specific policies regulating the sector.