HOUSING
Lagos is experiencing a huge boom in population and as such requires more housing
KEY DRIVERS
Increasing population with annual growth of 3.2%
The Nigerian Mortgage
Re-financing Company is providing increased access to liquidity and long-term funds.
The Federal government has made $300 million available to support real estate development.
Current Situation in Real Estate
Housing Deficit
5 million units
Housing Demand
20% growth / annum
Av. Population Growth
Over 1,500 people/ day
Influx of Expatriates
About 10,000 / annum
Growth of malls
1 – 13 malls within 9 years
Contribution to mortgage
72 houses built to meet demand for low cost housing
Lagos real estate is relatively unsaturated, this
makes it an attractive investment destination
Investing in Residential Housing
A substantial percentage of every individual’s wage is contributed to a fund controlled by the Federal Mortgage Bank of Nigeria to provide mortgages to low-income families and to support the development of low cost homes. The recently completed low cost residential houses in the state has further emphasized this opportunity, as more people are now able to afford a mortgaged home.
Investing in Office Building
Lagos being the economic hub of West Afr ica houses the headquarters of over 90% of companies in Nigeria , this shows the need for construct ion of office space to meet current demand
Investing in Malls
The annual growth in the retail sector of 7.4% has had an implicit effect on the high demand of modern malls. The Palms Lekki mall has expanded to abo ut do uble its current size to meet the current situation.
Lagos State real estate market has an average return on investment of 30%
Low Cost Housing
Required Investment
per housing unit: $30,000-$60,000
ROI: 6%-9%
Rental yield: 8%
Payback Period: 14 years
Luxury Housing
Required Investment
per housing unit: $30,000-$60,000
ROI: 6%-9%
Rental yield: 8%
Payback Period: 14 years
Malls & Retail Stores
Required Investment
per housing unit: $30,000-$60,000
ROI: 6%-9%
Rental yield: 8%
Payback Period: 14 years
Office /Commercial Housing
Required Investment
per housing unit: $30,000-$60,000
ROI: 6%-9%
Rental yield: 8%
Payback Period: 14 years
*Land and building materials account for 54% of investment required