Stakeholders in Nigeria’s real estate sector have warned that removing Value Added Tax (VAT) on land and rent will not address the ongoing surge in housing costs across the country. Experts argue that the real drivers of high rent are rising prices of building materials, weak regulatory oversight, and the absence of accessible mortgage systems, rather than taxation.
The warning follows clarification by Taiwo Oyedele, Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, who stated that VAT is already exempt on land, buildings, and rent under the current Nigeria Tax Act. Oyedele also explained that new tax reforms are intended to ease rental burdens, amid reports of a 25 percent tax on building materials.
Major cities including Abuja, Lagos, Kano, Enugu, and Port Harcourt have experienced dramatic rent increases. In Abuja, the annual rent for a one-bedroom apartment has more than doubled, rising from N500,000–N1,000,000 to N1.5–2 million in areas such as Dawaki, Jabi, Jahi, Kubwa, Dutse, and Nyanya, often exceeding the yearly earnings of workers earning the national minimum wage of N70,000.
Former President of the Real Estate Developers Association of Nigeria, Aliyu Wamakko, highlighted soaring cement prices as a key factor driving housing costs. He noted that cement now costs over N10,700 per 50-kilogram bag and that high demand coupled with supply shortages directly impacts the cost of construction, rent, and housing availability. Wamakko also cited Nigeria’s housing deficit of over 14.9 million units as worsening the problem.
Hakeem Suleiman, President of the Association of Abuja Tenants, added that weak regulatory oversight and the lack of accessible mortgage systems exacerbate rental pressures. He called for government intervention to control arbitrary rent hikes and implement effective mortgage schemes. Despite inflation dropping to 15.10 percent in January 2026, the cost of living remains high for most Nigerians, highlighting the complexity of addressing the housing crisis.
