High Price Of Cement, Weak Mortgages Fueling House Rent Surge – Experts

Stakeholders in Nigeria’s real estate sector have argued that removing Value Added Tax (VAT) on land and rent will not address the persistent rise in housing costs across the country, insisting that deeper structural challenges are responsible for the crisis.

Naija News reports that their position follows a clarification by the Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, who stated that VAT is already exempted on land, buildings and rent under the tax framework currently being implemented.

The clarification came amid reports alleging that the reform introduced a 25 per cent tax on building materials and other related items, a claim Oyedele dismissed while maintaining that the policy is designed to ease the burden of high rental costs on Nigerians.

Despite the clarification, property experts insist that the real drivers of high rent lie elsewhere, particularly in the rising cost of construction and limited access to housing finance.

Public frustration has continued to grow as rent prices soar nationwide. In major cities such as Abuja, Lagos, Kano, Enugu and Port Harcourt, accommodation costs have risen sharply.

In Abuja, for instance, the annual rent for a one-bedroom apartment has climbed by more than 100 per cent, rising to between ₦1.5 million and ₦2 million from previous rates of ₦500,000 to ₦1,000,000 in areas such as Dawaki, Jabi, Jahi, Kubwa, Dutse and Nyanya. Similar increases have been recorded in other urban centres.

In many cases, annual rent now exceeds the yearly earnings of workers on Nigeria’s ₦70,000 minimum wage.

Speaking to Daily Post, a former president of the Real Estate Developers Association of Nigeria, Aliyu Wamakko, said attention should shift from VAT removal to the escalating cost of building materials, especially cement.

“First and foremost, it is only land that they removed Value Added Tax on.

“The real issue is cement price. Because the primary thing that we build houses with is cement. And now the issue is that cement is more than ₦10,700 per 50-kilogram bag. Even at the factory price, cement is ₦10,500 now.

“And the more they build roads with cement, the more cement goes up.

“Because the demand now is going to go high. And once the demand is high and the supply is low, there is every opportunity for the community to increase costs, and every variable on that commodity will definitely increase.

“Be it rent, be it a house, be it whatever, as long as it is dependent on cement as the primary product to produce that product.

“Looking at it, there is an over 14.9 million housing deficit in Nigeria, which centres around the four major cities.

“That is Abuja, Lagos, Kano, and Port Harcourt. But the reality of the issue is that as long as the building materials are going up, there is no way you will get a reduction from the prices.

“Honestly, there is no hope. If the renewed hope would really renew the hope, it should start from the reduction of cement price, at least in the aspect of real estate,” he said.

Weak Regulation, Poor Mortgage System Blamed

On his part, the President of the Association of Abuja Tenants, Hakeem Suleiman, attributed the worsening rental conditions to weak regulatory oversight and the absence of accessible mortgage systems for ordinary Nigerians.

“Majorly, house rents are high because of a lack of a control mechanism and inadequate or total absence of mortgages for ordinary Nigerians.

“You used to rent a self-contained property for ₦250,000 annually and all of a sudden, the fees are raised to ₦1,000,000 with no value added to the property. This is the problem: there is no government control.

“Some agencies, lawyers or caretakers arbitrarily increase house rent without recourse to the harsh economic realities tenants face.

“Government regulators must wake up. Effective mortgages for tenants to transition into house owners must be in place. Enough of government inaction while Nigerians bleed,” he said.

Meanwhile, findings by National Bureau of Statistics (NBS) show that although Nigeria’s inflation rate dropped to 15.10 per cent in January 2026, the cost of living for most citizens has remained elevated.

Naija News reports that rising construction costs, housing deficits and limited access to financing continue to push rents beyond the reach of average Nigerians, worsening the country’s housing crisis despite ongoing fiscal reforms.