The Cost of Poor Urban Planning on Real Estate Value in Nigeria

ESV Labbo  Suleman

Urban planning should serve as the blueprint for how cities grow, evolve, and function. Unfortunately, in Nigeria, poor urban planning or in some cases, the complete absence of it has become a silent threat to the real estate sector, driving down property values and discouraging both local and foreign investment.

From Lagos to Abuja, Port Harcourt to Kano, the evidence is glaring. Cities are expanding rapidly, but without clear, coordinated urban plans that consider infrastructure, zoning regulations, population growth, and environmental sustainability. As a result, developers build in areas that lack basic amenities like access roads, drainage systems, and clean water. While these properties may initially sell due to high demand for housing, their long-term value often depreciates when the surrounding infrastructure fails to improve or maintain livable standards.

One of the most direct consequences of poor urban planning is flooding. In places like Lagos, which suffers seasonal flooding, properties located in poorly drained or unplanned areas lose value quickly. Prospective buyers and renters avoid flood-prone zones, leading to high vacancy rates, reduced rental income, and ultimately, lower property prices. Despite the initial capital investment, property owners end up with assets that are difficult to sell or lease.

Another issue is indiscriminate land use. Without proper zoning laws and enforcement, you may find residential buildings sitting side by side with noisy factories, open markets, or even fuel stations. Such chaotic development reduces the appeal of neighborhoods, creating discomfort for residents and reducing property desirability. Investors, especially those from abroad, often shy away from such areas due to uncertainty and the potential for legal disputes or future demolitions.

Access to infrastructure is also a major concern. Many housing estates in Nigeria are built without connecting roads, street lighting, public transport systems, or healthcare and educational facilities nearby. This forces residents to travel long distances for basic needs, which diminishes the perceived value of the property. Real estate thrives in organized environments where people can live, work, and access services easily.

Poor urban planning doesn’t only affect residential real estate; it also limits commercial real estate potential. Businesses are unlikely to invest in retail or office spaces located in chaotic or inaccessible environments. Even high-quality commercial properties may underperform if they’re located in poorly planned areas with traffic congestion, lack of parking space, or poor security.

In the long term, the lack of proper urban development also affects government revenue. Lower property values mean lower taxes. It also discourages the private sector from contributing to housing development, widening the housing deficit in the country, currently estimated to be over 17 million units.

To reverse this trend, Nigeria needs to prioritize comprehensive urban planning. Governments at all levels must enforce existing master plans and update them to reflect current realities. Collaboration with town planners, real estate developers, environmental experts, and community stakeholders is crucial. Additionally, public-private partnerships can help fund key infrastructure projects that will make real estate more valuable and sustainable.

The real estate sector is a key driver of economic growth, job creation, and national development. But without sound urban planning, its full potential will remain unrealized. It’s time Nigeria treated planning not as an afterthought but as the foundation for building livable, valuable, and resilient cities.

Labbo, an Estate Surveyor and Valuer, sent in this piece from Abuja, Nigeria.