Housing policies in Nigeria encompass the legal and financial frameworks used by the government to manage housing deficits, regulate rent and provide affordable homes. Housing policies in Nigeria have repeatedly failed, not because of scarcity of ideas, but due to system-level breakdowns. The following are the actual factors driving the failure:
- Poor implementation and low delivery rates: During the President Shehu Shagari era (1979-1983): government targeted 200,000 units in four years, only 32,000 units were completed, making just 16 percent achievement rate. The sum of N1.9 billion was allocated, but only a paltry sum of N600 million was spent for 32,000 units. The N600 million represented 33 percent of financial commitment to achieve 16 percent of objectives.
In the Third Development Plan, out of 202,000 anticipated units, only 20,950 were completed, representing just 13.3 percent success rate. Between 1960 and 2015 overall, 618,498 units were planned nationwide, but only 85,812 were built, representing just 14 percent of target. Under the present nationwide Renewed Hope Cities and Estates programme, the federal government has developed a total of 10,112 housing units out of the 50,000 earmarked for phase 1 (20%). The Renewed Hope Cities and Estates Programme currently has 14 active construction sites nationwide out of 36 states and the Federal Capital Territory (FCT).
- Policy design flaws: In most cases, the housing developments are targeting the wrong audience. Houses built often ignored the taste, preferences and income of intended beneficiaries because housing developments lack “needs assessment”. Standard, stereotype designs had no relation to cultural environment. Many thus remain unoccupied. According to President Bola Ahmed Tinubu, “houses built and not sold will turn into monuments”.
- Unaffordability is usually built-in in the projects. Late President Muhammad Buhari’s 2016 National Housing Programme houses are “unaffordable and left to rot away”. President Bola Ahmed Tinubu’s market-driven reforms are “grossly unaffordable” due to Nigerians’ low income, inflation, devaluation and lack of active and robust mortgage system.
- High costs of land and titles acquisition: Land costs make affordable projects financially unviable. Building materials are always very expensive because they are mostly imported.
- Housing finance system breakdown: There is no functional mortgage system in Nigeria. This forces buyers to pay full price upfront. Housing finance penetration is under 1% of Gross Domestic Product (GDP) versus 10-20% in advanced countries’ housing markets.
- High interest rates: Monetary Policy Rate (MPR) forces developers to build “out of pocket” because banks would not finance real estate projects with single digit rate. Loan requirements are prohibitively high for the average investor.Â
Limited long-term loans: Most Nigerians build houses gradually without loans leaving Nigerian average housing development gestation period to be 15 years.
- Land and bureaucratic bottlenecks: The rate of land acquisition chaos is too high for comfort. Urban land cost is prohibitive, securing titles is cumbersome and the roles of rogue agents are discouraging. Traditional landowners lay claim to purchased land; formal ownership rights are hard to get and these usually lead to land-grabbing. Bureaucratic delays result in long approval processes and unexplained demolitions. Also, getting mortgage loans is not easy due to bottlenecks in loan administration. Overlapping regulations, weak policy implementation and inconsistent application frustrate developers.
- Corruption and failed PPPs: Housing is now a cash cow for most governments. Mass housing projects became “cash cows” for government ministries, departments and agencies (MDAs) instead of social investments. Public Private Partnership (PPP) which other countries see as saving grace in infrastructure provision is failing in Nigeria. Former President Goodluck Jonathan’s Affordable Housing Scheme failed mainly through Public-Private Partnership. Experts have warned that we need legal and operational frameworks and organisational structure and capacity building for our PPP to function.
- The deeper problem: Nigeria does not only have a housing shortage, but it suffers from a systems failure.
Nigeria’s housing deficit is officially 14.92 million units in 2025, but annual formal production is below 100,000 units. The real issue is that Nigeria does not suffer primarily from a housing shortage. That is secondary. It suffers from a failure to develop systems capable of producing housing repeatedly, affordably and at scale. Even existing stock is in trouble: 15.2 million housing units are structurally inadequate – physically present but below safety and habitability standards.
- Politicisation: The government of South West states (UPN controlled states) allocated land for Shagari housing estates at the outskirts of the cities to engineer failure of the programme. The Shagari Estate at Ikire is still vacant up till now.
What should be done Remedies
To avert this unpalatable situation, we need to do the following:
Establish our local housing system based on our culture through the patronage of local building materials. This will stabilise our fiscal policy, lower inflation, reduce building material costs.
– Establish a structure that will ensure transparent PPPs with real accountability.
– Encourage cooperative housing.
– Engage in urban renewal to upgrade substandard houses and communities.
– Practice land and services schemes with digital land allocation, digitize registries.
– Introduce Property Identification Number (PIN) to identify property owners and their property holdings.
– Deepen housing finance market, liberalise long-term access to loans.
– Ensure periodic review of housing policies + effective implementation.
Nigeria has been debating on affordable housing endlessly while producing remarkably little structural change. A saying says: “only a fool continues to do the same thing the same way and expect a different result”. A federal government which plays a prominent role in fund allocation to states and local governments should have land holdings in all the states. The demand for housing is real – urbanization has crossed 60 percent of the total population and supply cannot keep up because the government converts demographic pressure into manifestoes, not houses.
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Olufemi Adedamola Oyedele, MPhil. in Construction Management, managing director/CEO, Fame Oyster & Co. Nigeria, is an expert in real estate investment, a registered estate surveyor and valuer, and an experienced construction project manager. He can be reached on +2348137564200 (text only) or femoyede@gmail.com
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