Few phrases in Nigerian real estate are used as loosely as "affordable housing." It appears on billboards for estates two hours outside the city, on brochures for flats priced beyond the reach of most salaried professionals, and in policy speeches that rarely say who the homes are meant for. The phrase has become a marketing label. It deserves to be a measurement.

Affordable to whom?

Affordability is a ratio. It compares what a home costs with what a household earns. A home is not affordable in itself; it is affordable, or not, to a particular family on a particular income.

That sounds pedantic until you look at who lives in Lagos. The Centre for Affordable Housing Finance in Africa (CAHF), which publishes an annual yearbook on housing markets across the continent, consistently finds a wide gap between the price of the cheapest newly built formal home and what most urban households can pay. In Nigeria, as in many African markets, a large share of households earn informal or irregular incomes, have little access to mortgage finance and build or rent incrementally.

So when a developer calls a two-bedroom flat "affordable," the honest follow-up is: affordable at what income, with what financing, and compared with what alternative?

The rent problem nobody puts on a billboard

Most people in Lagos rent. And for renters, the problem is often less the monthly figure than how it is collected. Landlords commonly demand one or two years' rent upfront, plus agency and legal fees. A household that could manage a monthly payment may have no way to produce a year's rent in one lump sum.

That means affordability in Lagos is partly a finance problem, not only a price problem. A flat at a reasonable annual rent is out of reach if the payment structure needs savings the household doesn't have. Monthly rent schemes, professionally managed rental housing and better tenant finance could widen access without changing the price of a single unit.

The cheapest home is not always the cheapest place to live

The second mistake is to measure affordability at the front door. A household's real housing cost includes what it takes to live in that home: transport to work, fuel for the generator, water deliveries, security levies and service charges.

Research on Lagos's expansion, including Basirat Oyalowo's work in Buildings and Cities, shows how growth at the edge of the city has come with unequal access to land and housing. Families often move outward because prices are lower. But a home on the periphery can carry heavy hidden costs: long commutes, higher transport spending, less time for work and family, and weaker access to schools and health care.

A useful test, then, is to add up the full monthly cost of living in a home, including getting to and from it. Measured that way, a modest flat closer to jobs and transit may be more affordable than a larger, cheaper house an hour and a half away.

Why the supply-gap number isn't enough

Lagos housing debates often lean on a single figure: the size of the national or city housing deficit. These estimates vary widely, are rarely current and often use different methods. More importantly, a deficit number says nothing about which homes are missing, where, or for whom.

The World Bank's Lagos diagnostic points to the connections between housing supply, land administration, infrastructure and urban finance. Put simply, the shortage is not only of buildings. It is a shortage of serviced, titled land in reachable places, and of finance that matches how Lagosians actually earn.

A better definition

If we were to write a working definition, it would go something like this: housing is affordable when a household can pay for it, and for the cost of living in it, without giving up other basic needs, and on terms that fit the way it earns.

That definition is demanding. It means designing homes with running costs in mind, not just build costs. It means taking location seriously. It means treating rental housing as a real part of the answer. And it means being honest in marketing about who a project serves.

Not every development needs to be affordable housing. Lagos needs homes at every price point. But when the word is used, it should mean something. A city this size deserves that precision.

Sources

1. Centre for Affordable Housing Finance in Africa, 2024 Housing Finance in Africa Yearbook, 2024.

2. Oyalowo, B., "Implications of urban expansion: land, planning and housing in Lagos", Buildings and Cities, 2022.

3. World Bank, Lagos Diagnostic Study and Pathway for Transformation, 2023.