One of the numerous challenges facing Nigeria is dearth of data.  As we do know, information is associated with data and knowledge.  Data is meaningful information and represents the values attributed to parameters, and knowledge signifies understanding of an abstract or concrete concept. Hence, without data, there is no information.

The ‘information challenge’ cuts across all sectors in Nigeria. It is so bad to the extent that even those in leadership position make bold to express this challenge, and over the years, nothing has changed.

Sometime in 2018 at the opening ceremony of OPEC’s data management training workshop in Abuja, the Permanent Secretary, Ministry of Petroleum Resources (MPR), Dr. Folasade Yemi-Esan, expressed worry over the non-availability of in-country data on Nigeria’s oil industry. She asserted that Nigerians had to go to the secretariat of the Organization of Petroleum Exporting Countries (OPEC) to source required data on Nigeria’s oil sector. Isn’t this very shameful?

The Nigeria Immigration Service (NIS) cannot affirmatively give the number of people that come into or exit Nigeria daily through our land borders. The former Comptroller General of NIS, David Parradang, made a disclosure while addressing the National Conference Committee on Immigration in 2014 that Nigeria has over 1,400 illegal border routes. As at then the 22,300 immigration officers were grossly inadequate to carry out the Service’s mandate, implying that the Service may not have adequate information on those that come in or exit Nigeria through these borders.

Another sector plagued with information dearth is the real estate sector. As professional valuers, we find it difficult to get comparable information of real estate transactions that can guide in forming opinion. There is no central data bank for recording concluded transactions, where industry players can visit to obtain real estate market information.

Similarly, the Managing Director, Federal Mortgage Bank of Nigeria (FMBN), affirmed that the housing deficit in Nigeria is estimated at between 17 to 20 million housing units with a potential cost of N6 trillion (US$16 billion), and a 900 000 annual unit deficit increase. But the amazing thing about this comment by the FMBN’s boss is that right from the tenure of former president Olusegun Obansajo, we have always been told that the housing deficit in Nigeria is 17 million. President Olusegun Obasanjo completed his two presidential terms in 2007 and even during his first term lasting between 1999 and 2003, the deficit figures were put at 17 million. We need to ask ourselves what is the true position or the exact figures of Nigeria’s housing deficit? Have we ever had a national housing audit to ascertain the exact figures? Who are the people responding for rolling out these figures without an empirical evidence to back up these numbers?

The above is just a random pick from across different sectors where the challenge of information is really affecting sector growth and would set the template for this article ADDRESSING THE HOUSING DEFICITS IN NIGERIA.


In this article, we would attempt to estimate the likely housing deficit in Nigeria, as conflicting figures keeps cropping up across different quarters depending on who is giving the figures owing to the lack of proper data on the housing stock in Nigeria, thereafter analyze what the challenges are and recommend ways to reducing the deficits within the next few ye


In the build up to this article, I tried to search the housing stock in Nigeria, if actual stock taking has ever been done, may be in 1960, 1970, 1980, 1990, 2000, 2010 and 2019. Behold, no meaningful information was obtained from anywhere apart from the usual phrase ‘Nigeria has 17 million housing deficit’

We might need to ask from those pushing the figures forward to provide information on how they came about the number, since it is the same 17 million that has always been put forward since 2003 to date. The origin of the particular figure is unknown, as it neither originated from the Federal Housing Authority (FHA) nor was it the outcome of any critical research, but any search on the internet would yield a 17 million figure. If from 2003 the housing deficit remains 17 million, what about the population of Nigeria?

In 2006 for instance, the Population census conducted put Nigeria’s population at 140,000,000. In 2016, another census should have been conducted but due to paucity of funds it was not carried out. However, as early as 2012 we were told our population had increased from 140 million to 180 million, now in 2019 the estimated figure is between 180 million to 200 million. Based on estimate, Nigeria’s population has increased by over 40 million at least in (12 years 2006 to 2018) why has the housing deficit figure not changed from 17 million since 2003? (Over 15 years) We can safely conclude that the 17 million housing deficit figure is wrong and has no basis.

How then do we tackle a problem when we have no idea of the extent we are been plagued by the problem?

From the foregoing, one thing is clear, we have housing deficit in Nigeria, but the exact number is unknown. Some stakeholders insist the deficit in housing requirement has been growing at 5.8 percent per annum, which has given rise to a slum population estimated at about 70 percent. This has also made estate developers, valuers and other housing experts to believe that the Nigerian housing deficit is much more than 17 million. Credence can be given to a figure above 17 million in view of a report by Brookings Institution in 2018 which shows Nigeria has now taken over as the nation with the highest number of extremely poor people in the world. At the end of May 2018, trajectories in the report suggest that Nigeria had about 87 million people in extreme poverty, compared with India’s 73 million. What is more, extreme poverty in Nigeria is growing by six people every minute, while poverty in India continues to fall.

In conclusion we do not know for a fact the actual housing deficit, but there is certainly housing deficit in Nigeria in comparative terms with our population and could be as high as 20 to 25 million or even more, but definitely more than 17 million



By definition, housing deficit/shortage means a deficiency or lack in the number of houses needed to accommodate the population of an area. In general, a housing shortage follows the economic principles of supply and demand. When the production of housing outpaces the demand there is a housing surplus. When housing production falls behind demand there is a housing shortage.

It must be emphasized that we do not have land challenges, but housing challenges. i.e land is available, but limited houses are available

From the foregoing, it is obvious population has a role to play in housing surplus or deficit, likewise economic condition of the country. However, there are other contributory issues which include:

Changing lifestyles meaning more people live alone or in small households, improper land utilization, building horizontal instead of vertical etc Others are highlighted below:


Paucity of finance and inaccessibility to mortgages from NHF, FMBN and PMI

There are numerous challenges confronting the housing sector in Nigeria even by continental parameters. According to former Finance Minister, Ngozi Okonjo-Iweala, Nigeria’s size of mortgage finance (as a share of Gross Domestic Product) is 0.5%; compared to 2% for Ghana and same 2% for Botswana. In a paper – ‘Unleashing the Housing Sector in Nigeria and in Africa’, presented in 2014 at the 6th Global Housing Finance Conference in Washington DC. Dr. Okonjo-Iweala pointed out that these figures contrast sharply with estimated mortgage finance to GDP ratio of 80% for the UK, 77% for the USA and an average of 50% across Europe.

This comment by Dr Okonjo-Iweala is alluding to the fact that several mortgage financing initiatives by successive governments in the country have failed, including that of President Goodluck Jonathan in whose administration she served as finance minister. We then need to ask ourselves, how accessible is National Housing Fund? What is the work of Federal Mortgage Bank of Nigeria? Are the Primary Mortgage Institutions helping in anyway? The National Housing Policy of 1991 created a two-tier housing finance structure with Primary Mortgage Banks (PMBs) at the first tier and the Federal Mortgage Bank of Nigeria (FMBN), the supervisor and regulator, at the second tier.


To encourage the penetration of the mortgage finance and homeownership, the National Housing Fund Law (Act No.3 of 1992) was promulgated to create an alternative and continuous flow of funds from which loans could be granted to contributors on affordable repayment terms. If we conduct a national survey on fund accessibility, how many Nigerians, would give positive response? It is very certain only few would and if otherwise why has the deficit in housing not reduced for so many years, if funds are available through effective mortgage financing system in the country? Nigeria is believed to have one of the highest numbers of homeless people in the world and dearth of housing finance has been fingered as the greatest factor inhibiting the provision of shelter for the Nigerian masses.

National Housing Fund NHF is yet to make any significant positive impact, as it is poorly designed. On the other hand, there is inadequate branch network of Primary Mortgage Institutions PMIs  for  easy  disbursement  of  loans  from  the  National  Housing  Fund, likewise inadequate  capital  and  weak  corporate governance of the FMBN. The above are real impediments to having an effective mortgage financing system in Nigeria.

It is amusing that one cannot obtain NHF loan to buy land, meaning to access the loan, you must own a piece of land with transferable title. Allocation paper is not acceptable. There is need to set in motion machineries at reforming the mortgage industry in Nigeria.


This is one of the major causes of housing deficit in Nigeria and also a major cause of real estate glut. Many real estate developers need to understand the business aspect of real estate development versus what my friend is doing. From 2016 to 2018, there has been a surge in the number of vacant properties in the upper class real estate neighbourhoods of Lekki, Victoria Island and Ikoyi.  According to a report published by Financial Derivatives Company Limited in 2016, this surge is as high as
72 per cent dating back from 2015. The truth be told, many factors are responsible for this glut, which may not necessarily be attributable to the economic indices or low purchasing power, but rather poor vision by the developers.

Real estate developers need to stop the bandwagon. ‘My friend has a property in Ikoyi, after selling he made 50% return on investment, hence I have to build in Ikoyi’ With this mindset, the developer buys a land in Ikoyi, develops it and since 2017 he has been unable to either let or sell the property. What could be responsible for this, knowing that his friend who he is trying to copy just cashed out big time?  Many factors are responsible

  1. Over pricing: Some developers place too much premium on properties all in a bid to make super profit. An apartment which should not cost more than N100 million is now costing N400 million, How will a rational investor pay N400 million for such crap?
  2. Poor Design: There are properties that are surplus to requirement, which no investor would want to buy into. Nigeria came out of recession about a year ago, and the economy is yet to pick up or fully recover as oil prices are still unstable and purchasing power is still weak. Hence, investors are now taking extra care before making to buy decision, by paying attention to every detail in the property. If there is a compromise in standard, it is a challenge and if there are too many unnecessary fixtures in the property, poor design or surplus to requirement, these would further increase housing deficit.


Cost of building materials in the country is a reflection of the current inflation rate and the prevailing foreign exchange rate. Most of the building materials in Nigeria are imported and it is what a merchant buys, he would sell. With high cost of construction, the developer would most likely transfer the cost to the end user. What then happens if the end user cannot afford the property? We would have vacancy and other developers knowing they may not derive return on investment would steer clear of developing houses. This in turn would impact housing deficit



A lot of people have argued that the 1978 Land Use Act is a clog in the wheel of real estate development, leading to increased housing supply in the country.

Section 5(1) of the 1978 Land Use Act gives the Governor legal authority to grant statutory rights of occupancy to any person for all purposes, while Section 22 makes it unlawful for any holder of a statutory right of occupancy granted by the Governor to alienate such right or any part thereof by assignment, mortgage, transfer of possession, sub-lease or otherwise howsoever without the consent of the Governor first had and obtained. Section 28(1) on the other hand, empowers the Governor to revoke a right of occupancy for overriding public interest while section 5(2) extinguishes all hitherto existing rights to the use and occupation of land, which is the subject of statutory right of occupancy.

In consonance with the above extraction from the Land Use Act, all transactions on land must be sanctioned by the state governor through the ministry of land. Similarly, there are other MDAs in the state that needs to grant approval/consent before a development of land can take place. In these ministries, there are lots of bottlenecks and bureaucracies that are often discouraging; as a result of time it would take before getting approvals.

For instance to get an approval to construct on any land from the ministry of Physical Planning in Lagos State, you need to have a valid title and to obtain a title can take more than 1 year based on practical experience. To get approval from other agencies also takes time. There is an adage in Yoruba language that goes thus ‘if it takes 20 years to prepare for madness, how many years would be left to display the madness’


Infrastructure is the bedrock of the economy. A well-developed infrastructure is not only essential for attracting foreign investment, it is vital for long-term growth and competitiveness of countries worldwide. Infrastructure inadequacies, as well as inefficiencies in transport logistics such as roads, ports and rail transport are major hindrances to economic development.

As posited in this article, we do not necessarily have land deficit, but housing deficit. Infrastructural deficit in many parts of the country means migration of people to where these Infrastructures are available. This puts lots of pressure on the city centre, leading to shortage of houses.

There are many untapped areas in the semi urban areas like, Agbowa, Agbara, Igbesa, Mowe, Ofada etc that mass housing schemes can be developed for people to live in, and with good transportation system and good roads, people can go to work at city centres and live in semi urban areas.

Poor infrastructure would lead to increase cost of development.

Fixing Nigeria’s infrastructure problems, could attract more foreign direct investments, create millions of jobs; curb crime rate and boost tourism. Besides, robust infrastructure can provide a boost to many sectors, including steel, cement, auto, and real estate, leading to rapid economic growth and sustainable development.


Development control is very essential in every part of the country to avoid environmental chaos and protect the interest of the public. This step has resulted into the establishment of several physical planning laws to regulate physical development in the cities and major urban centres. Despite the existence of these laws over the years, most Nigerian cites are still far from being referred to as ‘world class’ cities. This has placed a serious question mark on the effectiveness of the development control mechanism in the country.

From 1974 – 2010 as a result of over 60 building collapse in Nigeria, 401 people have died and several more haven’t been reported or accounted for. Privately owned buildings both commercial and residential account for the highest number of collapsed buildings in Nigeria Many would remember the Lekki Gardens Estate collapse that led to the death of many in Lagos.

There are minimum requirements that should be met before an approval to construct can be granted.  Some of these requirements are jettisoned, leading to haphazard developments, encroachment of land and erecting of building on drainage line. Certain developments are constructed without the prior knowledge of the planning authority and some buildings erected are not in line with the drawings submitted for approval.


Zoning laws are a regulatory framework that will affect decisions to develop, build and/ or renovate, sell and/ or lease our existing or newly acquired properties. Various federal, state, and local zoning laws regulate the real estate industry.

Within each distinct zone, laws typically allowed only certain types of use, such as detached one-family homes or commercial buildings. Zoning also specified building densities and height limits, minimum yard and setback dimensions and minimum parking space requirements. Those zoning criteria have persisted. For example, within Eko Atlantic City, minimum land that can be developed starts from 1000sqm and above and you are restricted to build a structure with about 10 floors at the minimum. In other areas, there is restriction regarding land utilization as well as heights, which would impact housing development.


Most developers now focus on the medium upper class and the upper class, forgetting about the lower class. We have so many vacancies in buildings at the high end neighbourhood, because not many Nigerians can afford them. We have 87 million extremely poor people, who can barely feed, talk less of renting or owning a home. In this case, developer should shift attention towards affordable non luxury accommodations. Studio apartments can be developed, likewise 1 bedroom and 2 bedroom apartments, with same offered for sale below N5million naira. Developers focus on Lekki, Ikoyi, Victoria Island etc without considering areas like Ketu, Ikorodu, Agege etc The focus should change, as there is deficit of small and medium sized houses.


Land utilization needs to be critically considered vis a vis zoning and town planning restrictions. Many Nigerians love to waste space. Instead of doing more of vertical development, they prefer ‘only me’ attitude and horizontal development. We sometimes find a single family living in a detached house sitting on a land size of 1000 to 4000 sqm. The detached houses sometimes cover about 25% of total land, leaving 75% undeveloped. This is very common as some families would not want to live with others.

A detached house on two floors with a total gross floor area of 300 sqm (150sqm on each floor) can comfortably be accommodated within a land area measuring  500 sqm, as only 150 square metres footprint is required for the ground floor, whilst the remaining half can be used as car parking, landscaping, gate house etc

Similarly, developers fail to maximize by developing vertically, having a block on 3 to 8 floors subject to planning approval. A block of 6 to 10 flats would accommodate more family compared with a block of 2 flats.


The livelihood of citizens of a particular country is a subset of the economic condition of that country. A country where people think about survival first, no one would think about shelter or housing. By the 2018 report, over 80 million Nigerians are extremely poor. This means at least 40 million would not be able to either rent a home or own a home.

People become poor as a result of their bad decisions or through failures of government. People who are poor cannot think about owning a home, rather feeding, which is the first form of survival.

Secondly, land cost is not affordable. Ikoyi, Lekki, Victoria Island, Magodo Gra, Ogudu Gra, Ikeja GRA are for the super rich, whilst Gbagada, Ikeja, Ajah etc are for the rich and some middle class.

LAND BANKING: Land speculation still persists unfortunately, despite series of threats of revocation by government. These speculators acquire both Government and private lands. Let’s take a look at Government Schemes in Lagos State. Lekki Peninsula Scheme 2 is one of the schemes designed by the Lagos State Government over two decades ago to satisfy the yearning of people for plots of land to build personal houses in the highbrow Lekki axis. The scheme has a land area of 514.53 hectares. Many people, who wanted to own properties in the choice area, including land speculators, rushed in and in a jiffy, all the land, including parcels that were heavily water-logged, were sold off.

In February, 2012 the former Governor Babatunde Fashola visited Lekki 2 area are discovered many plots undeveloped. Governor Babatunde Fashola who was evidently worried by this development, frowned at the activities of land speculators in the area and warned plot owners in the scheme to commence the development of their plots, or have them confiscated by the State.

In a similar vein, The Permanent Secretary, Lands Bureau, Mr. Bode Agoro in 2015 gave a directive on behalf of Lagos State Government that all allottees of state lands, particularly those within Victoria Island, Ikoyi, Lekki 1 and 2 and Abijo Residential Schemes, must take physical possession and develop the plots allocated to them on or before December 14, 2015. He cited the state land law mandates allottees or holders of Right of Occupancy to fully develop their plots within two years of allocation, which he said, informed allocation of plots of lands on the schemes.

Now in 2019, nothing much has changed. Most Lagos State Government Schemes remained undeveloped as most primary allottees acquired them for speculative purposes and not for any development or those who actually want to build do not have the resources to do so

see part 2 of this article:Addressing the Housing Deficit in Nigeria Part 2

This article expresses a personal opinion as well as the view of others  pertaining to some of the challenges in Nigeria’s housing sector, and does not in anyway substitute for such professional advice or services and it should not be acted on or relied upon or used as a basis for any decision or action that may affect you or your business, without consulting a qualified real estate Advisor.

Ademola Ladega  (ANIVS, RSV MNIM, FIMC) is the managing partner of AOL Management Consult (www.aolmanagementconsult.com.ng) He is a highly experienced real estate consultant with field/practical experience spanning over 9 years, having previously worked at Ismail and Partners, where he contributed a great deal to the success of the firm and rose to the position of the Head of Valuation and Senior Associate 

Mr Ladega has extensive experience of providing valuation services in Nigeria to large public and private companies in many sectors including utilities, banking, insurance, financial services, agro-industrial, shipping, commercial and trading sectors. As well as experience in reporting in accordance with the regulatory requirements of Nigeria, in full compliance with ESVARBON Nigeria Valuation Standards (Green Book) 2018 IPSAS, IFRS, RICS,  and IVS

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