Why There Are Empty Houses in Wealthy Neighborhoods of Abuja and Lagos

In Abuja’s affluent areas, the story of Johnson Wede exemplifies a growing issue: numerous finished buildings stand empty while everyday citizens face housing struggles. Wede, a devoted family man, lived with his wife and two children in a spacious three-bedroom flat in Wuse 2, a prestigious area. Their annual rent of N3 million was steep but manageable, thanks to the convenience and proximity to their workplaces and friends.

However, their stability was shattered when their landlord converted the residential building into a commercial space, forcing them to move. Desperate to remain in Wuse 2, Wede found only options priced between N4 million and N5 million per year, all recently unoccupied. He questioned why property owners wouldn’t lower rents slightly to make some money rather than leaving them vacant.

Unable to afford these exorbitant prices, Wede and his family relocated to Life Camp, a less expensive area farther from their social circle and workplaces. This move disrupted their lives, increasing their daily commute and distancing them from friends and familiar surroundings.

Wede’s story underscores a broader housing crisis in Abuja and Lagos, where high-end properties remain empty while families are priced out. To investigate this issue, Nairametrics spoke with real estate consultants managing high-end properties.

Temple Ugwu, a real estate surveyor with Bluemeen Partners, explained that one reason for the numerous empty houses in upscale areas is the selective targeting by developers and property owners. They aim to attract high-net-worth tenants such as oil and gas workers, corporate executives, expatriates, and celebrities. This narrow focus excludes many potential renters who could afford the high rents but do not fit this specific profile, resulting in significant vacancy rates.

“Many high-end properties in cities like Lagos and Abuja remain vacant because developers and property owners often aim to attract only high-net-worth tenants, leaving out a large segment of the rental market,” Ugwu explained.

Furthermore, landlords in upscale areas often hold out for tenants who can meet their high rental demands. Once a property is occupied, it depreciates faster due to wear and tear, leading to additional maintenance and repair costs, which they want to avoid unless the rental income justifies these expenses.

Adepetu Emmanuel, a Lagos-based estate surveyor and valuer with A. A. Babarinde & Co., noted that some houses in upscale neighborhoods of Ikoyi, Banana Island, and Victoria Island in Lagos remain empty because their owners keep them for prestige rather than renting them out for profit.

Another real estate consultant, who requested anonymity, attributed the high rental prices in upscale areas of Abuja to the enormous costs incurred by developers or property owners while acquiring land and constructing these buildings. With almost no empty land available and the few plots being extremely expensive, developers often buy and demolish existing properties to build new ones, requiring substantial financial investment. Consequently, they prefer to keep these properties vacant rather than lower the rent, believing that reducing the rent would undervalue their investment.

The Abuja-based real estate surveyor also highlighted the influence of unprofessional agents who inflate rental and sale prices, misleading property owners about market values, and leading to overpriced properties that deter potential renters and buyers.

With housing gaps estimated at 17 to 18 million in Nigeria, according to some estimates, and more than 28 million Nigerians lacking access to decent and affordable housing, the issue of empty, finished houses in highbrow areas of Lagos and Abuja is a growing concern.

To address this issue, experts recommend that developers and property owners broaden their target market to include more potential renters. Government intervention through incentives and policies, such as tax breaks or subsidies for developers who rent out properties at competitive rates, could encourage more balanced pricing. Implementing competitive pricing strategies and hiring professional property managers to ensure accurate market valuations are also suggested.

Balancing prestige with practical considerations to enhance property utilization and preventing property hoarding for prestige purposes could help increase the availability of high-end housing, addressing the broader housing crisis affecting many Nigerians.