Residential property in 2026: rent, costs and sale value

Housing need and tenant affordability

A shortage of homes does not mean every flat will find a tenant at any price. Start with the people likely to rent the property: where they work, what they can afford and which other homes they could choose. A flat may remain empty if its rent and service charge are too high for those tenants.

In January 2026, the Federal Ministry of Housing and Urban Development reported a committee estimate of 14.925 million missing housing units for 2025. This national estimate does not measure demand for a particular flat. It cannot tell you what rent a tenant will pay or how quickly a property will sell.

Rent growth and the price you pay

Knight Frank’s Lagos Market Update for the second half of 2025 reported rising residential rents in selected locations. Its 2026 outlook expected demand for smaller homes in areas such as Yaba and Surulere. That is a market forecast, not evidence that a particular flat is occupied or will earn the advertised rent.

Gross rental yield is annual rent divided by the purchase price, before costs. If a flat costs ₦75 million and earns ₦6.75 million in a year, its gross yield is 9%. These are example figures. If expenses and lost rent total ₦3.375 million, the remaining income is ₦3.375 million, or 4.5% of the purchase price. Purchase costs would reduce the return on the total money spent further.

A rising rent does not always improve your return. If the purchase price rises faster than rent, a new buyer receives less rental income for each naira invested. Repairs and other costs can also rise faster than rent.

• Compare signed leases and rent actually collected with advertised rents.
• Check who pays the service charge and what it covers.
• Allow for empty periods, repairs, insurance, management and applicable taxes.
• Include purchase and sale costs when estimating the overall return.

Assess the street and the building

For a property in Lagos or Abuja, visit or commission an assessment of the actual location. Check access at busy times, drainage, power, water, security and the condition of shared facilities. A lower purchase price may come with higher repair costs or fewer suitable tenants.

Compare similar properties: the same number of bedrooms, similar condition, and comparable services. A rent for a furnished short-stay flat is not a reliable guide to a long-term unfurnished tenancy. An expensive address does not guarantee reliable tenants, rising value or an easy sale.

Income, estimated value and sale profit

Rent can produce cash while you hold the investment, after expenses and any reserves required by its terms. A valuation is an estimate of what the property might be worth. It is not an offer from a buyer and does not produce a payment to you.

Profit on a sale is realised only when a sale completes and the net amount received exceeds the relevant investment costs. Debts, taxes and sale expenses can reduce what is left. A property may sell for less than its latest valuation or its purchase price.

Shard uses a separate company for each property. Your rights to rental payments and sale proceeds are set out in the investment documents. Shard’s resale market is not currently available, so do not assume you can sell your shares when you need cash.

Check the assumptions before investing

Interest rates can affect borrowing costs and demand from buyers. Inflation can raise repair bills while making rent less affordable. Exchange-rate changes can affect imported building materials and the value of your returns when measured in another currency. Test what happens if costs rise, rent is missed or the sale takes longer.

Read the title evidence, valuation date and basis, management responsibilities and exit terms. For a larger investment, also consider how much of your total savings would depend on one property, tenant group or manager. A strong forecast needs evidence and room for setbacks.