Lagos Named Africa’s 4th Priciest Rental City as Annual Rent Soars to N26.8 Million
- Lagos ranks as the fourth most expensive African city for renting a two-bedroom apartment, behind Abidjan, Cape Town, and Accra
- Rents in Lagos have surged, pushing the income-to-rent ratio to around 70%, far above the United Nations affordability benchmark of 30%
- The crisis is driven by several factors, which have created both financial strain for residents and investment opportunities in rental housing
Legit.ng journalist Victor Enengedi has over a decade's experience covering energy, MSMEs, technology, banking and the economy.
Frequent rent increases have pushed Nigeria into the spotlight as one of the most expensive countries for tenants in Africa.
A recent report titled “Average rent of 2-bedroom apartments across Africa’s most important cities” underscores this trend, ranking Lagos as the fourth most expensive city on the continent for renters.
Source: UGC
The city trails Abidjan, Cape Town, and Accra, which occupy the top three positions. Other cities listed include Douala, Nairobi, Kigali, Dar es Salaam, Cairo, and Casablanca.
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According to research by Fortren & Company, renting a luxury two-bedroom apartment in upscale Lagos neighbourhoods such as Ikoyi, Banana Island, and Victoria Island costs an average of $19,379 (about N26.8 million) annually.
Comparable apartments are significantly more expensive in Abidjan ($41,671), Cape Town ($27,813), and Accra ($26,299).
Affordability crisis deepens for Lagos residents
Despite its fourth-place ranking, renting in Lagos is becoming increasingly difficult for residents.
Analysts describe the current situation as a rental surge driven by sharp and sustained price increases. Over the past two years, rents have jumped between 50% and 200%, according to Chudi Ubosi, real estate expert and Principal Partner at Ubosi Eleh + Co.
This spike has pushed the income-to-rent ratio to roughly 70% —far above the 30% affordability threshold recommended by the United Nations. The result is mounting financial pressure on households, especially in urban areas where housing demand is highest.
The situation is largely fueled by the high cost of homeownership. Inflation, expensive building materials, and steep borrowing rates have made it difficult for many Nigerians to buy property.
As a result, more people are turning to rental housing, intensifying demand and enabling landlords to raise prices beyond what many tenants can comfortably afford.
Investor Opportunities Amid Housing Pressure
While the rental crisis is straining households, it is also creating openings for investors. Analysts note growing potential in build-to-let developments, particularly smaller units like one- and two-bedroom apartments that cater to high demand.
Across major cities, rising rents are pushing residents away from urban centres toward suburban areas where housing is relatively cheaper.
Even so, demand pressures are spilling over, with two-bedroom apartments in some outskirts now renting for between ₦1.5 million and ₦2.5 million annually.
The report links Lagos’ high rental costs to several factors, including limited land availability, strong demand in prime districts, rising construction expenses, speculative activity, and currency depreciation.
It also highlights that many luxury properties are priced in dollars, effectively limiting access to a small segment of the population and keeping prices elevated.
Source: UGC
Lagos to launch monthly rent payment
In related news, Legit.ng earlier reported that the Lagos state government plans to introduce monthly and quarterly rent payment options to ease the financial strain on residents.
Housing commissioner, Moruf Akinderu-Fatai, explained that this policy aims to make housing more affordable by providing flexible payment methods.
He said that a pilot phase for the initiative is currently being developed in consultation with landlords and other stakeholders.
Source: Legit.ng
