Economic Growth, Market Bubbles, Government Policies, and ROI among others, can be a major influence on the prices of Real Estate in any location.
Lagos attracts a large number of businesses, professionals, and migrants creating a strong demand for both residential and commercial investment opportunities. The real estate market caters to different levels of income and preferences from affordable options to luxury properties.
But it is important to note that the real estate market in Lagos just like any other market is subject to fluctuations and changes over time. Factors such as government policies, economic conditions, and population growth, to mention a few, can affect the prices of Land.
Lagos is the Commercial Capital of Nigeria
Lagos plays a pivotal role in Nigeria’s economy as it has shown a rapid growth in it economy compared to other states in Nigeria. It is home to major financial institutions, multinational corporations, and various industries such as banking, telecommunications, manufacturing, media, entertainment, and more. The city generates a significant portion of GDP, over 30% of the Nigerian economy.
With strategic location on the Atlantic coast which makes it an important port city for international trade, gives Lagos unending opportunities for total advancement. The city also has a well-developed transportation infrastructure, including an international airport, seaports, and a network of roads and bridges which further supports its commercial activities.
Lagos has a vibrant and dynamic business environment for real estate included, with a diverse and entrepreneurial population. With a large pool of skilled labor and a thriving startup ecosystem that has contributed to the growth of many successful businesses, prices of land in Lagos can be readily influenced.
Also, the largest city in Africa, with a population of over 21 million people, is a very vibrant business economic environment with numerous opportunities for entrepreneurs and investors to explore real estate; from lands, residential/commercial properties, affordable to luxury properties it’s a real estate hub.
Keeping in mind that the vibrant economy has led to a growing middle-class population with insights to spend on luxuries and affordable real estate.
We all are aware of the population rate of Lagos, which is projected to keep on increasing in the coming years. As more people move to the city in search of employment, business opportunities (it offers a wide range of economic opportunities, attracting both local and international business opportunities), and a better quality of life), the demand for all types of real estate- housing, commercial spaces, lands rises.
Lagos is a highly populated and dense city with limited available resources including land. The high demand for real estate properties in Lagos is a true factor that influences the price in the real estate market.
Also, rural-urban migration is a significant factor driving the demand for lands and real estate in Lagos. Many individuals and families from rural areas migrate to Lagos in search of better education, healthcare, and employment opportunities. This influx of people creates a need for residential properties and support.
Where there is a high demand for properties and a shortage in the availability of properties (due to population, economic growth, etc.), this can create an unstable market.
The scarcity of land also creates competition among buyers, who may be willing to pay a premium to secure a piece of land in a desirable location. This competition can influence the price of land in Lagos.
Lagos is a city with limited land available for development. This has led to a situation where demand for land greatly exceeds supply. And also knowing fully well that Lagos is built around a series of bodies of water, this limits the amount of buildable land.
Taking into account that the scarcity of land has led to the development of high-rise buildings and vertical housing which takes more resources to construct, will tend to attract high-end cost of living around the environment it’s located at.
NOTE: Lagos state has a considerable amount of land in Lagos that is meant for the State Government, so this constrains the potential supply for the general public.
Real Estate Market Bubble
The real estate market bubble occurs when property prices rise rapidly and significantly above their intrinsic market value driven by speculations and demand. This creates a situation where people are driven to pay high prices for properties.
The real estate market in Lagos, just like any other market is subjected to fluctuations and changes over time. While Lagos has seen significant growth in its real estate market in recent years, there is always the possibility of a real estate market bubble.
There have been some signs that the real estate market in Lagos could be experiencing a bubble.
This could be due the rising factors like; rapidly rising prices, high demand from non-users, overvaluation, loose lending from banks to real estate developers, and influx of new genres of businesses like tech.
But this point is subjective to experts as some might claim there is no Real Estate Bubble.
Investment Reward Opportunity
Investing in real estate in Lagos, Nigeria can be a promising opportunity due to the city’s rapid urbanization, population growth, and strong demand for housing and commercial properties.
Lagos Real Estate Market can be considered to be a high-risk and high-reward investment, but on the other hand, Lagos is a rapidly growing city with high opportunities for investors who are willing to do their due diligence and work with reputable agents.
There are always risks and challenges when it comes to investing, and when it comes to Lagos land purchase structures, like complex land tenure systems and zoning can be somewhat difficult for some investors.
It is important to note that prices of lands in Lagos are subject to Location, amenities, and market trends and some of these factors can be subjected to specifics of the city like the potential growths.
But be as it may, these highlighted factors can influence the price of Lands in Lagos.
While the word “overpriced” can be subjective, prices of lands are not the same all over Lagos.
To enquire about lands in Lagos, do contact us.