A retrospect of Nigeria’s real estate market in 2024

For a year characterised by high market volatility and economic hardship, including accelerating inflation and hike in consumer prices, Nigeria’s real estate sector still managed to hold its ground as a reliable sector for financial investment, new high-rise buildings and numerous residential projects springing up especially in our urban cities.

Nigeria’s real estate landscape in 2024 underwent significant transformation, and as the year winds to a close, it’s apt to reminisce on the major highlights of the industry, particularly the factors propelling its growth and the complexities associated with the industry in order to understand the underlying issues behind the gains.

The real estate sector started the year on a scary note, with economic pressures from inflation hugely affecting the cost of building materials and supply chain processes coupled with increased interest rates, which combined to deplete the purchasing power of property buyers. Property developers struggled to manage and control their offer prices, as the costs of both local and imported inputs continued to skyrocket. Potential homeowners struggled finances to purchases as houses increasingly became unaffordable, obtaining mortgages also became prohibitive because of high interest rates. However, amidst this chaos, the Nigerian real estate market has grown by 7.24 per cent, and is expected to peak at $2.14 trillion value at the end of 2024. The industry has shown resilience in the face of adversity; continually fostering the mix of innovation, creativity and tenacity—thanks to the professionals who have been on their toes to make this a reality.

Speaking about the year in view, Chief Executive Officer, Queensville Limited, Real Estate Developers, Mr. Essien Vincent Umo, highlighted the resoluteness of the real estate industry. He informed that the industry has grown a structure for adaptability, hence, despite economic and global throes, it would still thrive.

“The country’s population rises daily, and as a result there are increased needs for housing. Real estate in Nigeria is rife with opportunities, and 2024 was another year opportunities were leveraged for growth,” he added.

Technology took a centre-stage in the real estate sector, making it one of the most remarkable highlights for 2024. The rise of digital platforms took real estate service to new and commendable heights. Properties can be easily searched for, property transactions can be conveniently handled, coaching and training about the niche was also made seamless, due to the adaptation of information technology, redefining how Nigerians interact with the market.

The blockchain technology, however, stood quite prominent because of its groundbreaking function, one which the industry has long suffered from. The blockchain technology through its algorithmic verification processes has helped to drastically reduce fraudulent systems in the industry, boosting investor confidence. This impact is quite evident in data captured from top real estate firms, signaling an accumulative 25 per cent reduction in fraud within the industry. This compares favourably with the records in previous years.

The industry made significant efforts in tackling the housing deficit by increasing developments on affordable housing, and even as challenges remain, there is hope for more concerted efforts in that regard. According to the Federal Ministry of Works, Public-private partnerships flourished. delivering over 10,000 affordable housing units across the nation. Mr. Vincent Essien in his words said, “The year saw a positive turn in the housing deficit issue. More real estate developers are now more aware of the gains associated with venturing into affordable housing projects. The process of facilitating and supporting the execution of affordable housing projects has further been complemented by the government through their support in forms of incentives, and less regulatory requirements.”

The year 2024 was remarkable for the real estate industry professionals, as it witnessed immense growth in areas of upskilling and certifications. Professionals have competently emerged as versatile, taking up multiple roles within the space in a credible way. Capacity-building programmes and certifications were greatly achieved by most firms for its employees, creating an avenue for competition in the market, particularly as it constantly evolves. In conferences like the annual Nigeria Real Estate Summit, professionals converge to discuss and chart a roadmap on professional trends and sustainable practices for the profession, taking cues from foreign markets. This is also another reason to emphasize the need for up-skilling, by participating in the conference and fostering good partnerships.

“I am incredibly proud of professionals within the Nigeria real estate Industry, as we have shown that true strength isn’t only about the properties we sell, but more critically about the people who drive the sales of these properties—to stay empowered and remain above their game. It’s a spirit of professional commitment, and if this is continued, it’s only going to be the start of our collective greatness,” remarked a real estate consultant and developer, Clement Oladipupo.

While the real estate sector achieved significant milestones for the year, the setbacks it constantly battled cannot be dismissed. Issues ranging from infrastructure deficit, economic uncertainty, funding constraints, and regulatory hurdles were factors impeding progress and affecting a large number of startups in the industry.

“Not only does the economy fluctuate from inflation and currency devaluation, it is coupled with the government’s arbitrary regulatory system that is complex and often hinders development,” Vincent noted. “Obtaining finance to either develop or buy a house has become increasingly difficult. This has created a scary gap, as developers increasingly become hesitant to hop on loans only to have their projects spending years in the market with no buyers or investors in sight.”

In 2024, Nigeria’s economy experienced a hike in consumer prices, reaching 32.7 per cent in September, and even worse in October as it peaked at 33.9 per cent, particularly in the food and energy sectors. Despite this devastating reality, the real estate sector through the International Monetary Fund (IMF), projected a GDP growth of 2.9 per cent for the year, reflecting expansion amidst economic woes. Further projections hold that the sector’s growth trajectory is expected to amass a CAGR growth rate of 7.10 per cent from 2024 to 2029, where it would accumulate over $3.41 trillion at the end of 2029. These statistics screams only one word: opportunity. The opportunities in the sector are enormous, and should be leveraged to drive more growth.

​​ The recovery of the middle-class demographic is promising, more growth as it presents significant opportunities for developers. Technological advancements in the form of online platforms and digital solutions also contribute to the opportunity, giving transformation to real transactions from stage of introduction to transaction consummation, seamless. While the government’s regulatory framework might be complex, its support by way of infrastructural development, especially through the development of highway and railways are making profound impact in closing the national housing deficit.

In recounting the highs and lows of the year, it is obvious that Nigeria’s real estate scene is mixed with transformative growth and lingering challenges. While the challenges will be tackled, the dedication and persistence of the industry’s professionals should take a better part of the fame. Their collective fortitude has landed the industry a prime value that is attracting international investments.

The future looks promising for Nigeria’s real estate landscape because of the numerous opportunities it presents. Further growth and expansion will now depend on how the industry’s stakeholders to continually leverage each opportunity to create significant changes in 2025 and beyond.

For Vincent, what lies ahead in the industry is quite promising, but he urged professionals within the industry to show more tenacity and be intentional. “2024 has taught us to be resilient, however, that isn’t the only tool needed for sustainable growth. We must regroup and continually champion the need for local innovation and collaboration to create sustainable change.”