Nigeria's rent inflation surged to 33.8% year-on-year in July 2025, the highest rate recorded in over a decade, according to the latest Consumer Price Index (CPI) report from the National Bureau of Statistics (NBS). The figure marks a sharp acceleration from 28.7% in June 2025 and 16.5% in July 2024, putting immense financial pressure on tenants across the country.
Urban and Rural Rent Divergence
The NBS data revealed that urban rent inflation hit 34.5% in July 2025, up from 29.1% in the previous month, while rural rent inflation climbed to 32.9% from 28.1%. The gap underscores the concentration of demand in major cities such as Lagos, Abuja, and Port Harcourt, where migration and limited housing supply have driven costs higher.
According to the report, the cost of renting a two-bedroom apartment in Lagos rose by 38% year-on-year, while similar properties in Abuja saw a 35% increase. Tenants in Port Harcourt experienced a 31% rise, reflecting the broad-based nature of the surge.
Drivers of Rent Inflation
The NBS attributed the rent inflation spike to a combination of factors, including rising building material costs, high demand for rental properties, and increased property taxes. The cost of cement, a key input, rose by 22% year-on-year as of July 2025, while steel prices increased by 18%, according to the report. Landlords have passed these costs onto tenants through higher rents.
Additionally, the NBS noted that population growth in urban areas has outpaced new housing construction, creating a supply deficit. The report stated that the country's housing deficit stands at an estimated 22 million units, the largest in Africa, which continues to fuel rent inflation.
Impact on Households and the Economy
The rent inflation surge has placed a heavy burden on Nigerian households, who already grapple with high food and transportation costs. The NBS reported that the average Nigerian household now spends 18% of its monthly income on rent, up from 14% a year ago. For low-income earners, the figure is even higher, reaching 25% in some states.
Economists have warned that the trend could exacerbate poverty and homelessness. According to the NBS, the national poverty rate rose to 42% in 2025, with housing costs being a major contributor. The report also highlighted that rent inflation is a key driver of overall inflation, which stood at 24.5% in July 2025.
Government Response and Future Outlook
In response to the crisis, the Federal Government has announced plans to increase the housing supply through the National Housing Programme, which aims to deliver 100,000 units annually by 2027. However, critics argue that the programme has been slow to materialize, with only 12,000 units completed in 2024.
The NBS report concluded that rent inflation is likely to remain elevated in the near term, as construction costs continue to rise and urban migration shows no signs of slowing. The agency projected that rent inflation could ease to 28% by December 2025 if the government accelerates housing delivery and stabilizes building material prices.
