Rents, construction costs to shape Nigeria’s property market in Q4 2026 – HDAN
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Nigeria’s property market is expected to stay active but increasingly selective in the final quarter of 2026, with rents under pressure, construction costs high and mortgage access still the biggest obstacle, a Housing Development Advocacy Network report says.
Nigeria’s property market is expected to remain active but increasingly selective in the final quarter of 2026, as rising rental demand, housing affordability pressures, high construction costs and constrained mortgage financing shape activity, according to a report by the Research and Economic Development Unit of the Housing Development Advocacy Network (HDAN).
The report said affordable residential developments, rental housing, serviced plots and income-generating properties are expected to attract greater interest than speculative luxury developments between October and December 2026. HDAN expects demand for one-bedroom and two-bedroom apartments and moderately priced rental housing to remain particularly strong, and projects that more households will relocate from expensive city centres to satellite communities where accommodation is relatively affordable.
Construction costs are identified as one of the biggest determinants of prices in the quarter. Although inflation has shown signs of moderating, HDAN said developers still face the accumulated effects of expensive building materials, energy, transport, labour, infrastructure provision and construction financing, warning that a slower rate of inflation does not automatically make cement, reinforcement steel and roofing materials cheaper. Some developers may respond by reducing building sizes, adopting alternative construction technologies, reviewing designs and phasing projects, but the unit warned that high costs could discourage new housing projects and worsen the supply shortage.
The report singled out inadequate access to affordable mortgage financing as one of the greatest obstacles to expanding homeownership. It noted that the Central Bank of Nigeria reduced its monetary policy rate to 23 per cent in September 2026, but cautioned that the adjustment does not automatically translate into affordable long-term housing loans. HDAN called for stronger coordination among the Federal Mortgage Bank of Nigeria, the Nigeria Mortgage Refinance Company, the Ministry of Finance Incorporated, Family Homes Funds Limited and the Ministry of Housing and Urban Development, and advocated expanded mortgage guarantees, rent-to-own programmes, housing cooperatives and financing designed for informal-sector workers.
Regionally, HDAN expects Lagos rental demand to remain strong, particularly for apartments and moderately priced homes, with affordability continuing to drive relocation to peripheral communities and neighbouring Ogun State. In Abuja, residential rents are expected to stay under pressure in established districts while demand for comparatively affordable accommodation in satellite communities increases. In Ogun, residential corridors benefiting from proximity to Lagos are expected to keep attracting land investors, first-time buyers and developers seeking relatively affordable development locations.