Understanding Real Estate Investment Returns in Nigeria
A practical guide to rental yield, appreciation, and the real costs behind property investment in Nigeria.
Doa Realty offers a straightforward path into real estate: buy a property, hold it, and earn from both rental income and appreciation. But to invest well, you need to understand how returns actually work.
Where returns come from
Two components drive your total return:
- Rental yield - the annual rent you collect as a percentage of the purchase price.
- Capital appreciation - the rise in the property's value over time.
A Lagos residential unit bought at a 6% rental yield that appreciates 8% a year is compounding a total return of roughly 14% annually before costs.
What a healthy yield looks like
Nigerian markets typically range between:
| Market | Typical rental yield |
|---|---|
| Lagos Prime | 4 - 6% |
| Lekki / Ibeju-Lekki | 6 - 9% |
| Abuja (Gwarinpa) | 5 - 7% |
| Port Harcourt | 7 - 10% |
Prime areas often show lower yields but higher appreciation. Newer corridors tend to offer the opposite.
Costs that eat into your return
Don't forget the deductions:
- Agency fees (one-off, typically 10% of first-year rent)
- Service charges and maintenance
- Tenancy void periods between renters
- Tax on rental income
Subtract these before comparing options.
How Doa helps
Every property we list comes with clear pricing, location details, and documentation guidance. Our team can walk you through title verification and rent structuring so your numbers hold up.
Invest with your eyes open, and let the property work for you.
Ready to start? Explore the realty portfolio or contact our team.
