If you’re a Nigerian, you probably think of buying property as a defining move, financially speaking. It’s looked upon as a sign of being a person of some means. But anyone who’s buying real estate assets should be sure that they’re doing so at the right time. The real estate market in Nigeria doesn’t stay the same; it moves in cycles.
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If you understand these cycles, you’ll know when to buy, where to buy, and how to get the best value for money.
What Are Real Estate Market Cycles?
A real estate cycle refers to the pattern of growth and slowdown in property prices and demand. Globally, this cycle has four stages: recovery, expansion, hyper-supply, and recession.
In Nigeria, however, the cycle is influenced by:
- Government policies and elections
- Infrastructure projects (roads, bridges, refineries)
- Inflation and naira devaluation
- Security and migration trends
The Four Phases of the Real Estate Market in Nigeria
These are the four phases of the real estate market cycle in Nigeria.
Recovery Phase
Here, sales are slow, and property prices remain stagnant. Developers may give discounts to attract buyers. This is the quiet stage where smart investors buy before demand rises.
Expansion Phase
Demand increases as more people start buying. This is when developers launch new estates, leading to increased construction activity. Prices rise steadily, making it the best time for average homebuyers to secure property.
Hyper-Supply Phase
At this point, there are too many houses or estates in the market. Sellers struggle to find buyers, and rental growth slows down. Some parts of the Lagos real estate market, for example, already show signs of oversupply in luxury apartments.
Recession Phase
The fourth stage, in which demand falls and property prices may drop or remain stagnant. To keep sales going, developers slash prices. “Distressed sales”, which see homes sell at steep discounts, become common. Patient buyers with cash can take advantage of this phase.
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Real Estate Market Trends: Abuja vs. Lagos
Let’s compare the market cycles of the most valuable real estate markets in Nigeria: Lagos and Abuja.
Abuja Real Estate Market
The Abuja real estate market is heavily influenced by politics and government activity. During election seasons or when new projects are announced, areas like Lugbe, Apo, and Jabi experience a sharp increase in demand. But when the economy slows, prices in Abuja often stagnate because much of the market depends on civil servants and political spending.
Lagos Real Estate Market
The Lagos real estate market is more dynamic due to migration, limited land, and constant business activity.
Areas like Ibeju-Lekki and Epe are booming because of projects like the Dangote Refinery and Lekki Free Trade Zone. Meanwhile, parts of Lekki and Victoria Island face oversupply in luxury apartments. This has slowed down rental growth. It’s an indication of the hyper-supply phase in action.
How to Know the Best Time to Buy Property in Nigeria
Track Infrastructure Development
New roads, bridges, or major projects often push up the prices of nearby. If you buy a home early in areas marked for significant infrastructure upgrades, you’ll position yourself to gain from asset appreciation.
Follow Real Estate Market Trends
The market is in expansion when rents and sales are rising steadily. But if properties stay on the market too long without buyers, you may be in a hyper-supply or recession phase.
Consider Your Finances First
Although market cycles are important, you should also think about your budget. If you find a good property in a promising location and you can afford it, that’s the right time for you.
Get Expert Guidance
Seek the informed opinion of real estate agents, surveyors, and valuers who understand real estate market trends in Nigeria. They are often able to spot opportunities before non-experts.
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Final Words
The real estate market in Nigeria moves in predictable cycles. You just need to study these patterns so you avoid overpaying for a home.
If you would like to purchase property but can’t stand the hassle of finding a trustworthy real estate agent, you can check the Connect Nigeria real estate site. It lists land and houses from across Nigeria, including those in locations with growing demand.
From Ibeju-Lekki to Gwarimpa, Surulere to Port Harcourt’s New GRA, you’ll find something that fits with real estate market trends is the key to timing your purchase. You can have a look at what’s on offer HERE.
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