Home » Market survey: Rents jump up as building costs rise by 50% in 6 months

Market survey: Rents jump up as building costs rise by 50% in 6 months

by Samson Echenim

Housing rents have gone up like a wild fire as cost of building and construction soar by 50% between June 2023 and January 2024.

According to a market survey carried out by The Nigerian Economy, on Monday, cost of major building materials have risen by a whooping 50%.

The cost of a 50kg bag of cement is now N6,800 up from N4,500 in June 2023, while the cost of 12mm steel length rose from N3,800 in June 2023 to N7,200 as at end of January and currently sold at N7,800.

Similarly, the cost of five tons of sand and granite (stones) rose from N30,000 to N55,000 and N60,000 to N90,000 respectively during the period under review.

The Economy reasons that there are slight changes in prices of the building materials in different parts of the country and proximity to sources of the materials. The survey was carried out on the Mowe/Ibafo axis of Ogun State, near Lagos, where thousands of residential properties are currently being developed to meet the rising housing needs of people working in Lagos.

Prices of electrical gadgets, installations and plumping materials have also more than doubled up during the period under review.

An estate agent in the area, Bisi Dada said rents have gone up so high.

She said: “As at June last year (2023), we could find three-bedroom, two-bedroom and mini-flat in Mowe/Ibafo at N300,000, N250,000 and N150,000 respectively, but from Januray this year (2024), these apartments are going for a minimum of N500,000, N400,000 and N250, respectively. If the buildings are new, the rents can be from N50,000 to N100,000 higher.”


Estate Surveyor and Valuer and lead partner at Kola Akomolede & Company, Tolu Dima-Okojie said in view of current economic climate, many landlords and developers “are transferring their rising costs to the end users -tenants.”

A steel dealer in Ofada, Obiora Orji blamed the high cost of building materials on the rising cost of dollar.

“All these materials are imported. I don’t know how much of steel products are locally made, but a much larger chunk of it are imported.

“I sold a length of 12mm iron at N7,200 last week even in this month of February, but as at two days ago, the price has gone up to N7,800. This rise in price also affected the rings and the binding wires,” Orji said.

Amidst the soaring cost of rent, Nigerians are finding it hard to pay the rents.

A landlord in Mowe who spoke with The Nigerian Economy, Bayo Solomon said he had to put his newly completed three blocks of six units of two-bedroom flat on rent at N450,000, down from N600,000 which he had originally hoped to rent them.

He said: “There are six units of two-bedroom apartments in the building and I had put them out for rent at N600,000 in April last year, but after over three months, no one was taken. The agents advised me to bring it down to N500,000 but it was still not going. We eventually got occupants who paid N450,000 per flat, but that is not a good rate for me. At that rate, it could take 30 years to get back the amount spent on building the house.

“Costs of building are rising too fast and too much and increasingly reducing developers ability to ramp up value of buildings within a reasonable period of time in rent.”


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The Nigerian Economy

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