A new report by an estate surveying and valuation firm, Ubosi Eleh and Company has revealed that the residential segment remains the cornerstone of Nigeria’s real estate market, with demand primarily driven by urbanisation and growth of the middle class.

The yearly publication: ‘The Nigeria Real Estate Report 2025’ described the real estate market as “a dynamic mix of opportunities and challenges.” The report summed up 2024 as “a year of economic recalibration”, noting that while households and businesses struggled under microeconomic realities, the real estate sector found itself at a crossroads.

It maintained that “2024 marked a transformative period in Nigeria’s political economy as President Bola Ahmed Tinubu embarked on bold reforms to tackle deep-seated structural challenges.”

It described the year as one “defined by resilience, adaptation and the pursuit of opportunities and daunting challenges.” According to it, while the cost of borrowing stifled capital formation and deterred investments, the real estate market bore the brunt of falling purchasing power and rising construction costs.”

In particular, the report pointed out that building materials, which are largely imported became more expensive due to exchange rate volatility whilst the market’s long-term potential remained visible, driven by robust demographic trends, rapid urbanisation and the country’s enduring housing deficit.

The report noted that the challenges of rising costs and dampened purchasing power were counterbalanced by opportunities inherent in the country’s growing population and urbanisation trends. Despite the huge challenges, the report is positive in its outlook for this year, now in the sixth month.

According to the report, warehousing continues to thrive, driven by logistics, while residential real estate is adapting to shifting demographics.
The projection is predicated on the continued and increasing Internet penetration and growth of e-commerce.

Similarly, commercial spaces are evolving in response to changing work patterns and the retail sector is adjusting to new consumer behaviours. The report is of the view that with strategic planning, investors could navigate these shifts for sustainable profitability.

On Nigeria’s hospitality sector, the report observed that it was experiencing strong growth, marked by a surge in luxury accommodations, an expanding mid-tier and budget segment and innovative serviced apartment offerings.

It believed the entry of international hotel chains, coupled with domestic tourism and business travel, creates substantial opportunities for investors and operators.

The strategic diversification of accommodation types and the integration of technology are two factors that would drive long-term growth and transformation in the industry.