2021 in Review: Real Estate Trends
The 2022 Nigeria Real Estate Market Outlook published by Northcourt, a real estate investment solutions company that adopts a research-based approach to developing and managing property, is a handy resource for anyone information on Nigerian real estate. We have highlighted two major trends which underpinned the market last year….
The preference for gated estates
“Gated estates have continued to solidify their position as the leading residential development model. The high fences, restricted entry and exit points make for much-needed security assurances in Nigeria’s leading cities, socially as tensions warm leading up to the elections.
Gated estates are typically made up of high-value residences and are intended for the affluent. Golf courses, community centres, and sports facilities are common amenities in gated estates. These further justify the market prices charged per housing unit or land plot. Investors require more from real estate projects and are looking to increase the sustainability features in their portfolios.
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Studies show that there are three main sub-sets: lifestyle communities are gated communities that emphasise recreation and provide a safe and secure location for golf courses and retirement villages. Prestige Communities place a premium on social prestige over lifestyle. The desire for image, privacy, and control are key objectives. Security communities are gated communities that prioritise security over social status and lifestyle. Estimates put the total number of estates at the Lekki-Epe Lagos corridor at 82 having 13,239 residences.”
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Increase in land prices
Land prices grew in almost all nodes considered. Leading locations as Ikoyi traded well over the N500,000psm mark with plots in Banana Island reaching N1Mpsm, where available. Land in gated communities attracts a premium for the security benefits that they provide. Prices in second-tier cities as Benin, Abeokuta and Ibadan are also projected to spike over the next few years. Prime new town locations attracted more investment, much of which was local – Eko Atlantic (Oxygen and Periwinkle residencies) and Orange Island, Lagos. Other new towns include Shoreline estate, Alaro city and Isimi Lagos. Seamless land transactions are a priority of the central government as regulators partner with the private sector to remove impediments. And as the nation moves closer to the 2023 election cycle, land prices are projected to grow.