An estate surveying and valuation firm, Ubosi Eleh and Company, highlights that while households and businesses struggled under harsh microeconomic realities, the real estate sector found itself at a critical crossroads, grappling with weakened demand, rising costs, and uncertain investor confidence.

It noted this in its annual publication, titled ‘The Nigeria Real Estate Report 2025’.

The report described the Nigerian real estate market in 2025 as “a dynamic mix of opportunities and challenges”.

Reviewing the previous year, the report summed up 2024 as a year of economic recalibration, noting that while households and businesses struggled under microeconomic realities, the real estate sector found itself at a crossroad.

“The year 2024 marked a transformative period in Nigeria’s political economy as President Bola Ahmed Tinubu embarked on bold reforms to tackle deep-seated structural challenges. It was a year, as one defined by resilience, adaptation and the pursuit of opportunities and daunting challenges. Whilst the cost of borrowing stifled capital formation and deterred investments, the real estate market bore the brunt of falling purchasing power and rising construction costs.

“In particular, the report pointed out that building materials which are largely imported became more expensive due to exchange rate volatility, whilst the market’s long-term potential remained visible, driven by robust demographic trends, rapid urbanisation and the country’s enduring housing deficit. The report averred that the challenges of rising costs and dampened purchasing power were counterbalanced by opportunities inherent in the country’s growing population and urbanisation trends. The residential segment, according to the report, remained the cornerstone of Nigeria’s real estate market, with demand primarily driven by urbanisation and the growth of the middle class.”

The report noted that despite the huge challenges, 2025 had a positive outlook.

It stated, “Warehousing continues to thrive, driven by logistics, whilst residential real estate is adapting to shifting demographics. The projection is predicated on the continued and increasing Internet penetration and growth of e-commerce. Similarly, commercial spaces are evolving in response to changing work patterns, and the retail sector is adjusting to new consumer behaviours. The report is of the view that with strategic planning, investors could navigate these shifts for sustainable profitability.

The report noted that Nigeria’s hospitality sector was experiencing strong growth, marked by a surge in luxury accommodations, an expanding mid-tier and budget segment and innovative serviced apartment offerings. It believes the entry of international hotel chains, coupled with domestic tourism and business travel, creates substantial opportunities for investors and operators.

“The strategic diversification of accommodation types and the integration of technology are two factors that would drive long-term growth and transformation in the industry,” it read.