Industry experts have said recent tax reforms introduced by the Federal Government are beginning to alter the structure of Nigeria’s real estate market, with visible effects on property prices, rents, and investment decisions.
The experts spoke on Thursday in Lagos at the 10th AlphaCrux Real Estate Outlook Conference, themed “Amplifying resilience in the real estate industry in a disputed global economy.”
Speaking at the event, the Managing Director of AlphaCrux Limited, Tobi Adama, said tax reforms represent one of the most significant policy factors likely to influence the real estate sector in the coming years.
“One of the key things is the new tax reform. We are still grappling with it. We are trying to understand it,” Adama said. “But one of the effects we have seen is that it has automatically increased the prices of rents and prices of properties.”
According to him, many property owners are passing the cost of new taxes directly to tenants and buyers rather than absorbing the charges themselves. “Most property owners now have to pay tax on it. So, instead of them paying that tax directly, they are adding the equivalent to the existing property prices,” he explained.
Adama added that broader economic trends could also influence the sector’s performance, noting that improved macroeconomic indicators often translate into stronger real estate activity. “Once the economy is moving in a positive direction, real estate will automatically also move in a positive direction,” he said.
He further observed that foreign investor interest is gradually returning. “We are seeing generally that inflation is down, our external reserves are growing, and a lot of foreign investors are coming back into the country,” he said, adding that the signs point to cautious optimism for the industry.
Adama also highlighted the growing role of technology in real estate, noting that digital tools now influence everything from invoicing to property acquisition, sales, and sustainable building design.
Also speaking, the Chief Operating Officer of Brokerfield Real Estate Services Limited, Akin Opatola, described the reforms as a positive step, particularly the newly introduced 1.5 per cent luxury property tax.
“Reforms are steps in the right direction,” Opatola said. “As regards the 1.5 per cent luxury tax, I appreciate the fact that it is targeted at the upper end of the pyramid.”
He noted that luxury developments in areas such as Victoria Island, Ikoyi, and Oniru have continued to attract buyers despite high prices, many of which are denominated in dollars. According to him, taxing such developments could become a strong revenue source for government.
However, Opatola stressed that infrastructure remains a major concern, especially in high-end locations. He cited poor road access and flooding challenges, particularly around Banana Island, as issues that undermine property value.
“In terms of infrastructure, we still have a long way to go in terms of roads, drainage, street lights, and security,” he said, urging greater collaboration between government and the private sector.
He added that improved infrastructure would encourage more development and expand tax revenues, helping Lagos evolve into a more resilient and competitive smart city.
