Rising Cement Prices Stall Housing Projects, Push Rents Higher in Nigeria
REDAN Raises Alarm as Cement Price Surge Disrupts Housing Development
The rapid increase in cement prices across Nigeria is slowing housing development and contributing to rising rental costs, according to the Real Estate Developers Association of Nigeria (REDAN).
At a recent industry briefing in Lagos organised jointly with the Centre for Housing and Sustainable Development (CHSD), developers warned that the surge in cement prices has become a major obstacle to housing delivery and infrastructure development nationwide.
Industry stakeholders say the escalating cost of construction materials particularly cement has placed significant pressure on ongoing building projects and forced many developers to reconsider project timelines.
Cement Prices Surge Above ₦11,000 per Bag
According to REDAN President Oba Akintoye Adeoye, the price of a 50kg bag of cement has increased by more than 30 percent within six months. Market data shows the product sold for around ₦7,500 in the final quarter of 2025, rising to ₦9,000-₦10,000 at the start of 2026.
Prices have since climbed further, with cement now selling for between ₦11,500 and ₦15,000 in several parts of the country, depending on location and supply conditions.
Developers say this sharp increase has significantly altered the cost structure of housing development. Cement remains one of the most critical inputs in construction, meaning price fluctuations quickly translate into higher building costs.
Impact on Housing Development
Real estate developers warn that the rising cost of cement is already slowing project delivery across multiple markets.
For developers working with tight financing arrangements or pre-agreed construction budgets, sudden cost increases make projects financially difficult to sustain. In some cases, construction timelines are being extended or projects temporarily suspended.
According to REDAN, the price volatility has raised concerns among private developers who are responsible for delivering a large share of Nigeria’s housing supply.
Industry experts note that when construction costs rise unexpectedly, developers must either absorb the additional expenses reducing profitability or pass the costs on to buyers and tenants through higher prices.
Rising Construction Costs Push Up Rents
Housing experts say the effect of higher building costs is already visible in the rental market.
Timothy Nubi, a professor and founding director of the Centre for Housing and Sustainable Development, said the surge in construction input prices is contributing to higher rents in major cities.
He cited the example of Abuja, where the annual rent for a self-contained apartment has increased to between ₦800,000 and ₦1.5 million, compared with around ₦400,000 previously.
This trend reflects a broader economic dynamic in which rising construction costs feed directly into housing prices and rental markets.
Pressure on Nigeria’s Housing Supply
The surge in cement prices comes at a time when Nigeria is already struggling with a severe housing deficit.
Private developers remain key contributors to residential housing supply, particularly in rapidly growing urban centres such as Lagos, Abuja, and Port Harcourt. However, sustained increases in building material costs could slow the pace of new housing delivery.
Industry analysts warn that when developers delay or scale back projects, the resulting reduction in housing supply may further intensify affordability challenges.
Calls for Policy Intervention
Stakeholders are increasingly calling for government intervention to stabilise building material prices and support the construction sector.
Policy proposals discussed within the industry include incentives for local production of building materials, improved supply chain efficiency, and fiscal measures designed to reduce the cost of construction inputs.
Developers argue that addressing the cost of cement and other materials is essential to expanding housing supply and improving affordability.
Outlook
Nigeria’s real estate sector remains a critical driver of economic activity, supporting employment, infrastructure development, and urban growth. However, sustained increases in construction material prices pose a growing challenge for developers and investors.
Unless the cost pressures ease, analysts warn that housing delivery could slow further, potentially deepening Nigeria’s housing shortage and sustaining upward pressure on rents across major cities.
