Lagos developers chasing prime housing finance as middle-class incomes rise, Sage Grey MD says
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Developers are increasingly seeking financing for housing projects in prime Lagos areas such as Ikoyi, Victoria Island and Lekki, driven by infrastructure and growing middle-class prosperity, says Sage Grey Group Managing Director Temitope Runsewe.
Developers are increasingly seeking financing for housing projects in prime Lagos locations such as Ikoyi, Victoria Island and Lekki, according to Temitope Runsewe, Group Managing Director of Sage Grey Group.
Runsewe spoke at the company's 10th anniversary news conference in Lagos on Thursday, responding to questions on the types of projects developers are seeking financing for and what this signals about demand.
He attributed the trend to infrastructure development and rising prosperity among parts of the middle class, and said consumer spending power remained evident despite macroeconomic pressures, citing the strong returns of companies such as MTN as an indication that demand for higher-end residential property persists.
Runsewe said the pattern could shift over the next two years, predicting a "sudden boom" in mass housing as rising housing costs make prime locations increasingly unaffordable for middle-income earners.
He said a two-bedroom apartment in a prime area could cost about N18 million in annual rent, compared with about N600,000 in locations farther out, and that improved infrastructure such as the coastal road made a 25-minute commute acceptable to households seeking to save on rent.
He expects development to spread towards the edges of Lagos and along major transport corridors as developers respond to affordability constraints in established prime markets.