Nigeria's Real Estate Sector Hits 13.1% GDP Contribution

Nigeria's real estate sector has become a significant contributor to the national economy, accounting for 13.10% of real gross domestic product. The construction sector experienced a year-on-year growth of 6.38% in the first quarter of 2026.

According to Knight Frank’s H1 2026 Lagos Market Update, this growth is influenced by increasing residential costs, ongoing infrastructure investments, and selective occupier demand in major urban centers such as Lagos, Abuja, and Port Harcourt. The national economic environment shows signs of stabilization, with headline inflation decreasing to 15.91% in June from 25.29% the previous year.

However, challenges such as high development costs and housing affordability continue to impact investment decisions. In Lagos, a shortage of formal housing supply has led to significant rent increases in prime areas, with rents more than doubling since 2023.

Consequently, tenant demand is shifting towards lower-cost housing options on the mainland. Additionally, transport infrastructure projects are expanding property development into suburban areas.