The Federal Government is preparing a comprehensive regulatory framework for Nigeria’s housing and built environment sector after the industry contributed more than ₦77 trillion to the economy in 2025.
Minister of Housing and Urban Development, Muttaqha Rabe Darma, disclosed this during a stakeholders’ validation workshop on the proposed National Housing Data Programme and National Housing and Built Environment Regulation Policy in Abuja.
Darma said the real estate services segment alone contributed about ₦41 trillion, representing approximately 13.4 per cent of Nigeria’s Gross Domestic Product, while real estate and construction combined generated more than ₦77 trillion during the year.
Despite the sector’s growing economic importance, the minister said the industry continues to face serious challenges, including weak regulation, fraudulent property transactions, abandoned developments, building collapses, inadequate housing data and limited access to affordable mortgage finance.
He said the proposed regulatory framework would introduce mandatory licensing for property developers and estate agents, while also establishing stronger mechanisms to protect people buying homes.
One of the major proposals is the introduction of regulated escrow accounts for buyers’ funds. Under the proposed system, developers would be required to lodge payments received from prospective homeowners into approved escrow arrangements, providing greater protection against fraud and failed housing projects.
The government also plans to strengthen construction quality standards and professional regulation while improving land administration and urban renewal practices.
A proposed National Housing Industry Regulatory Commission would provide broader oversight of the sector, while a National Housing Data Observatory is expected to improve access to reliable information on housing supply, demand and development.
Darma said credible housing data was essential to effective planning and investment decisions. The government has consequently been working on a National Housing Data Programme designed to establish a more reliable picture of the country's housing situation.
The ministry's technical committee has estimated Nigeria's core housing deficit at about 15 million units as of 2025, using internationally recognised methodologies including the World Bank Adequate Housing Index and the UN-Habitat Household Crowding Index.
The minister said the proposed policies were at the final stakeholder consultation stage before being presented to the Federal Executive Council for consideration and approval.
He urged participants at the validation workshop to scrutinise the proposals carefully and make recommendations that could improve the final policies.
The government is also working on reforms to the mortgage sector as part of its broader housing strategy. The proposed National Mortgage Industry Policy would establish a National Housing Finance Authority, reform the Federal Mortgage Bank of Nigeria and expand access to housing finance for workers, including those in the informal sector.
The Federal Mortgage Bank of Nigeria has also announced that its National Mortgage Registry is ready for deployment. The digital platform is expected to provide a central repository for mortgage transaction records and improve transparency within the housing finance market.
Darma said the reforms were necessary to ensure that the enormous economic value generated by the housing sector translates into better protection for Nigerians and greater confidence for investors.
The government is particularly concerned about Nigerians losing their savings to unlicensed property developers and fraudulent housing schemes. Mandatory licensing and escrow arrangements are expected to reduce such risks by placing greater accountability on developers and property agents.
The proposed reforms could also affect how developers market properties before construction is completed. The ministry has indicated that off-plan housing sales would be subject to licensing and financial safeguards designed to protect buyers.
For investors, stronger regulation could provide greater certainty and confidence in Nigeria's property market. For homebuyers, the government hopes the measures will reduce fraud and improve the quality and reliability of housing projects.
However, successful implementation will depend on effective enforcement across the federal and state levels, particularly because land administration remains significantly influenced by state governments under Nigeria's legal framework.
The Federal Government has said it will work with state authorities, professional bodies, developers, financial institutions and other stakeholders to develop common standards and improve the overall functioning of the sector.
The reforms come as Nigeria continues to face a substantial shortage of adequate housing, rising rents and limited access to affordable home financing.
With the housing and construction sector already contributing more than ₦77 trillion annually, the government believes establishing stronger regulation could help unlock further investment while protecting Nigerians from some of the risks associated with the property market.
The proposed policies are now expected to proceed to the Federal Executive Council after the completion of stakeholder consultations.
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