As Nigeria looks for new economic growth engines, the vacation home market represents a largely untapped opportunity. Experts say until the government improves tourism infrastructure, security, and public-private collaboration, developers will continue to favour urban housing, short-lets, and commercial properties, CHINEDUM UWAEGBULAM reports.
Despite Nigeria’s rich landscapes—from the breezy shores of Ilashe in Lagos to the misty hills of Obudu in Cross River—vacation homes remain a niche and underdeveloped segment in the country’s real estate market.
While other nations leverage seasonal housing for tourism and investment, Nigerian developers appear to be steering clear. At the heart of the issue are low domestic demand, weak promotion, and inadequate public facilities, which reduce both the appeal and profitability of vacation homes.
The market for second homes—typically driven by upper-middle-class families and retirees—is hampered by economic volatility and a shrinking middle class. It’s a known fact that wealthier Nigerians often invest in vacation properties abroad, in countries with more stable infrastructure and security.
Most Nigerians prioritise homes for primary residence or rental income. The middle class, which typically drives the vacation home market in other countries, is relatively small and financially constrained in Nigeria. Inflation and construction costs have also affected property developments.
For developers, the appeal of scenic locales quickly fades when faced with poor infrastructure. In Lagos, beachside communities like Ilashe and Tarkwa Bay lack proper roads, electricity, and security. Building there means footing the bill for basic amenities on top of already high land costs.
The issue is complicated by land acquisition processes and legal disputes over land that discourages long-term real estate investment, especially in less-populated areas. Also, mortgage and credit facilities for luxury or secondary homes are scarce, making it harder for buyers to fund vacation properties and reducing developers’ incentive to build them.
There are also fears of coastal erosion and climate risks that discourage long-term investment. Security threats from sea pirates in some coastal zones reduce investor confidence and weak tourism policy. For instance, Lagos State’s tourism development is inconsistent and largely private sector driven.
Developers see better and faster returns from residential or commercial properties in urban centres than from niche markets like vacation homes. They also noted that rising insecurity, especially in rural or coastal areas, deters potential buyers and limits the attractiveness of vacation properties.
Cross River State, once Nigeria’s tourism poster child, tells a cautionary tale. Projects like the Obudu Mountain Resort and the Tinapa Business and Leisure Resort have suffered from neglect, inconsistent policies, and dwindling visitor numbers.
Yet some see potential. With Nigeria’s population surpassing 200 million, domestic tourism is growing, especially among millennials and the diaspora. Real estate experts believe the solution lies in targeted policy. Already, there are a handful of places like Epe and Badagry (Lagos) and Ikom (Cross River), where some developers are experimenting with hybrid models—homes that serve as short-term rentals.
As Nigeria grapples with a housing crisis, vacation homes may not be a top priority—but for forward-looking investors and policymakers, they represent a missed economic opportunity. Experts agree that with the right mix of infrastructure, incentives, and marketing, the tide could still turn.
Lagos, particularly Lekki, Epe, and Ilashe, offers beachside and waterfront property potential. Wealthy Nigerians and expatriates frequent beach resorts and private chalets in these areas and proximity to the city makes short getaways feasible.
Locations like Obudu Cattle Ranch, Tinapa, and Calabar, once symbolised Nigeria’s hope for tourism-led development that offers natural beauty, temperate climates in the highlands, and a legacy of cultural festivals (Calabar Carnival) are still struggling due to the collapse of government-backed infrastructure, especially neglect, underfunding, and political mismanagement.
There also poor roads, unreliable flights, and lack of internal transport limit tourist flow, security issues in surrounding regions (including communal clashes) affect the perception of safety and low private sector confidence as developers see high-risk, low-return scenarios, especially with unclear property rights around Obudu and surrounding areas.
Experts noted that until Nigeria improves tourism infrastructure, security, and public-private collaboration, developers will continue to favour urban housing, short-lets, and commercial properties. They called for tax incentives for vacation housing developers that offer five to ten-year tax holidays for developers investing in government-approved tourism zones.
According to them, the federal and state governments have critical but distinct roles in unlocking vacation home schemes in Nigeria. Their involvement should focus on creating an enabling environment, reducing investors’ risk, and integrating vacation housing into broader tourism and economic development strategies.
They also recommended the provision of import duty waivers on construction materials for eco-resort development, designation of areas like Ilashe (Lagos) and Obudu (Cross River) as Tourism Housing Development Zones and fast-track land acquisition and title processing for developers within these zones.
An estate surveyor and valuer, Dr Samson Agbato, said many Nigerian coastal or beach areas lack good access roads, consistent electricity, clean water supply, waste management systems, and reliable internet — all of which are critical for a comfortable vacation experience.
According to him, private developers shy away from investing heavily in these areas because the cost of providing such infrastructure privately is enormous and often eats into profit margins.
Other issues, he enumerated include landownership and title challenges, security concerns, limited domestic vacation culture, inadequate government support and policies, environmental risks and coastal erosion, high cost of development and low financing options, lack of strong short-let and tourism rental platforms, perception and trust issues, and absence of tourism cluster.
Agbato, who is also the Director, School of Environmental Studies at Moshood Abiola Polytechnic, explained that several short-let apartments and beach houses already exist in Lagos, especially in Ilashe Beach, Tarkwa Bay and Badagry coastal areas, which act as weekend getaways and in high demand for party houses and Airbnb-style vacation homes, but challenged by traffic congestion and urban sprawl.
He said these areas are private serene beaches with an exclusive resort and increasing popularity for weekend retreats, boat cruises, and vacation rentals like in Ilashe, which has seen the rise of luxury beach homes for private owners and short rentals. He added that the challenge has been that access is mostly by boat; logistics for construction and maintenance are expensive.
Agbato traced the limited development of the market to weak return on Investment (ROI) and market uncertainty as investors are wary of ROI, especially in areas with no active tourism ecosystem. “Unlike countries like Kenya or Ghana, Nigeria lacks a strong domestic tourism culture. Many Nigerians don’t take vacations or prioritise beach getaways as part of their lifestyle.”
The Chairman, Cross River branch of the Nigerian Institution of Estate Surveyors and Valuers (NIESV), Mr Edet Okon, corroborated this. He told The Guardian that vacation homes are not common because Nigerians don’t create time for vacation and prefer to build country homes in their villages, where they visit for ceremonies and festive seasons.
He said there have not been conscious efforts by state governments for clearing, cleaning and making the seashore attractive, adding that not much is done to protect shoreline from encroachment, erosion and other ecological problems.
Okon said there is weak framework on beach ownership and development as the Federal Government owns certain miles of the seashore across the country. He urged the state governments to facilitate access to beaches by the developers to encourage vacation homes.
