Banana Island, Old Ikoyi lead as land, house prices rise in Lagos

DESPITE the nation’s economic downturn and the ravaging COVID-19 pandemic, which slowed down construction activities, land, rent and house prices are maintaining upward trajectory in major Lagos’ property market, Tribune Newspaper has learnt.

According to the field survey carried out by estate surveyors on the cost of lands, rental and sale values of residential and commercial properties in Lagos’ Property market, Banana Island, Old Ikoyi and Victoria Island recorded the highest prices.

Banana Island, Ikoyi and Victoria Island also recorded the highest rentals for office spaces in the state

It was also noted that Ikeja GRA maintained the lead in Lagos mainland’s property market

On the other hand, Lagos Island, though situated in the same zone with Banana Island and home to the highest offices and businesses, recorded low rental cost of N22,413 per square metre (sqm) .

The report attributed poor infrastructure to low rental cost and property values in Lagos Island Central Business District.

All these were contained in the Nigerian Institution of Estate Surveyors and Valuers (NIESV)’s Lagos Property Market Consensus Report H1 2020, obtained by Nigerian Tribune at the weekend.

The report divided  entire Lagos  State into seven zones namely:  Island zone A (Lagos Island, Old Ikoyi, S/West Ikoyi, Banana Island, Victoria Island);  Island  Zone B (Lekki Phase 1, Ikate, Osapa, Agungi and  Chevron);  Island Zone C  (Ajah, Sangotedo, Awoyaya and  Lakowe);  Mainland Zone 1 (Surulere, Yaba, Ilupeju and Gbagada);  Mainland 2 (Amuwo Odofin, Isolo, Festac, Apapa);  Mainland 3 (Ikeja GRA, Maryland, Ikeja and Alausa);  and Mainland 4 (Ogba, Ogudu, Magodo GRA 1 (Isheri) and  Magodo GRA 2 (Shangisha).

On cost of lands in zone A,  Banana Island commands the highest  land value at N407,500 per sqm, followed by Old Ikoyi – 364.048/sqm; Victoria Island –N313.571/sqm; South West Ikoyi (S/W) –N285.667/ sqm and Lagos Island –Ni80.357/sqm respectively.

On rental values for three-bedroom and 4-bedroom detached apartments in the  above zone A,  rents for three-bedroom cost N9.952 million in Banana Island; Old Ikoyi –N6.8 million; Victoria Island -5.586 million; S/W Ikoyi –N4.576 million and  Lagos island – N2.294 million, while  rents of 4-bedrrom detached cost N16.97 million in Banana Island;  N15.416 in Old Ikoyi; N11.011million in Victoria Island; N8.443 million in S/W Ikoyi and N3.590 million in Lagos Island, respectively.

Besides, the NIESV’s report noted that land and house prices in Island Zone B and C, comprising Lekki Phase 1, Ikate, Osapa, Agungi & Chevron, Ajah, Sangotedo, Awoyaya  and Lakowe  on the Lekki –Epe corridor have kept increasing in values as they welcomed more development.

In zones B and C above, Lekki Phase 1 leads in land’s cost at the rate of N173.519/sqm , followed by Ikate –N107.019/sqm; Chevron –N99.929/sqm; Osapa –N97.185/ sqm; Agungi –N86.200/ sqm; Ajah – N58.818/ sqm; Sangotedo – N32.833/ sqm; Awoyaya –N25.167/ sqm and Lakowe –N17.273/ sqm.

Accordingly, rents for three-bedroom in Zone B and C above cost N3.314 million in Lekki; N2.629 in Ikate; N2.461 in Osapa; N2.275 in Agungi; N2.716 in Chevron; N2.016 in Ajah; N941.887 in Sangotedo; N679.187 in Awoyaya and N560.417 in Lakwe; while rents for 4- bedroom detached house cost N3.314 million, N3.533 million, N3.551 million, N3.231 million, N3.673 million, N2.016 million, N1.6675 million, N1.118 million and N1.072 milion respectively in the locations.

The increasing land‘s cost and rent in Zone C to be specific, the consensus report stated was hinged on major projects like the ongoing Dangote Refinery, Lagos Free Trade Zone, Fourth Mainland Bridge and new Alaro City, which are expected to come on stream in a few years, adding that upon completion, they would further trigger rise in property values in these locations.

The presence of supporting infrastructure, the NIESV’s Consensus Report also established had contributed to the capital value’s increase in Ogudu and Magodo Shangisha areas, “but this has not met corresponding rental valuation resulting in lower yields”.

It pointed out that Ikeja GRA and its surrounding areas like Maryland, Mende, Shonibare estate remained the most expensive locations on the mainland part of Lagos State.

“This is expected to continue as more residential and commercial development come up in these neighbourhoods, particularly Ikeja GRA, in few years’ time,” the report read.

On the mainland zones, Ikeja GRA leads as land in the neighbourhood costs N216.875/sqm, followed by Alausa- N142.766/sqm;  Ikeja –N126.756/sqm; Maryland –N109,737/sqm;  Ilupeju –N97.315/sqm;  Magodo Shangisha- N94.000/sqm;  Gbagada – N81.786/sqm;  Apapa –N80.714/sqm; Surulere –N75.100/sqm;  Magodo Isheri – N74.100/sqm;  Yaba –N73.655/sqm; Ogudu –N63.545/sqm; Ogba –N43.500/sqm;  Amuwo Odofin –N31.038/sqm;  Festac – N19.892/sqm and Isolo –N17.400/sqm.

On rental values for 3 and 4 bedroom apartments, Ikeja GRA also leads with average rents of N3.397 million and N5.962 million per annum, followed by Maryland  (N2.066 million, N3.301 million);  Ikeja (N1.717 million, N3.284 million); Alausa (N1.864 million, N3.193 million); Apapa (N2.112 million, N3.118million); Magodo Shangisha (N1.730 million and N2.623 million); and Ilupeju (N1.630 million and N2.928 million) respectively.

On rental property yields via a consensus of estate surveyors and other property professionals in Lagos state, the report stated that average residential capital values and rental values in 30 nodes within the state were computed.

From the consensus data,  the report had it  that Chevron neighbourhood on the Lekki-Ajah Road  showed the highest  property yield of 6.87 per cent, followed by  Agungi  6.31 per cent, while Osapa came in third with 6.06 per cent.

The report read: “The lowest yield was seen in Ogudu – 3.10 per cent, next being Magodo Shangisha – 3.19 per cent and third being Magodo Isheri 3.20 per cent. It is critical to understand that these figures are averages of a consensus of value opinions and may not reflect every individual transaction.”

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