Nigeria Projected to Lead African Real Estate Growth, Dubai Investors Watch Opportunity

Nigeria's real estate market is poised for the fastest growth across major African economies over the next five years, with a projected compound annual growth rate (CAGR) of 6.9% between 2025 and 2029. This growth trajectory surpasses that of other key regional players, including Kenya (5.1%), Rwanda (3.6%), Ghana (3.4%), and South Africa (3.0%). The optimistic outlook is primarily attributed to rapid urbanisation, a burgeoning population, and persistent housing shortages.

Investment Appeal and Market Drivers

Despite macroeconomic challenges and foreign exchange pressures, Nigeria received a 5/5 rating for overall investment appeal, placing it ahead of other significant African property markets. The country, along with Kenya, also scored a strong 4/5 for growth speed. Key factors bolstering Nigeria's investment outlook include its large market size, ongoing urbanisation, and the potential for relatively high investment returns due to significant housing deficits.

In terms of rental yields, Nigeria ranks fourth among the assessed African markets, with an estimated gross rental yield of 8.0%. This is supported by robust housing demand and rapid urban expansion. Southern African markets generally reported the strongest gross rental yields at approximately 10%, followed by Zimbabwe (9.2%) and Cameroon (9.1%).

Hotspots and Regional Context

Investment activity in Nigeria is concentrated in high-value locations. Lagos, particularly the Lekki corridor and Eko Atlantic, is identified as a major property investment hotspot, attracting investors to high-end residential, commercial, and mixed-use developments. Elsewhere in Africa, Nairobi continues to see strong demand for residential and logistics properties, while Kigali, Rwanda, is gaining interest for mid-market mixed-use projects supported by efficient urban planning.

The broader African real estate sector is anticipated to expand at an annual rate of 5.58% between 2025 and 2029, more than double the projected global average growth rate of 2.69%. Currently, Africa accounts for only about 2.7% of the global real estate value, estimated at $17.6 trillion, indicating substantial room for expansion as urbanisation and demand for various property types continue to rise across the continent.