The Cost of Building vs. Buying a House in Lagos

Lagos is one of Africa’s most dynamic cities and also one of its most expensive real estate markets. For anyone hoping to own a home here, the big question is simple but critical: should you build or should you buy? Both options come with unique costs, risks, and benefits. Understanding these factors can help you make a decision that aligns with your financial capacity and long-term goals.

1. Land Acquisition vs. Purchase Price

Building: To build, you first need land. Prime locations like Lekki, Victoria Island, and Ikoyi can cost upwards of ₦200,000 to ₦800,000 per square meter, while outskirts like Epe or Badagry may range from ₦5,000 to ₦50,000 per square meter. Beyond the purchase price, you must also factor in survey plans, Certificates of Occupancy (C of O), and other documentation fees.

Buying: When purchasing an existing house, the price usually includes land and structure. However, developers often add a profit margin, making completed homes in high-demand areas significantly more expensive.

2. Construction Costs vs. Upfront Payment

Building: According to recent estimates, constructing a standard 4-bedroom duplex in Lagos can cost anywhere from ₦60 million to over ₦150 million, depending on design, materials, and location. This cost is spread over several phases foundation, structure, finishing which allows flexibility in funding.

Buying: Buying a ready-made property requires bulk capital. A completed duplex in Lekki Phase 1 can cost between ₦180 million and ₦300 million, while mid-tier neighborhoods may range from ₦50 million to ₦120 million. You pay almost everything upfront or through a mortgage plan if available.

3. Customization vs. Convenience

Building: You control every aspect of the design, from layout to finishing. This ensures the home reflects your taste and lifestyle. However, it also requires significant oversight, trusted contractors, and time.

Buying: Buying offers instant ownership with little hassle. The downside is limited customization, most buyers accept the developer’s design, even if it doesn’t fully suit their preferences.

4. Hidden Costs

Building: Expect expenses for approvals, soil tests, community levies, and unplanned variations in material costs due to inflation. Delays in construction can also increase costs.

Buying: While developers handle approvals, buyers must still verify titles, pay agency fees (typically 5% of the purchase price), legal fees, and sometimes hidden service charges in gated estates.

5. Which Option Makes More Sense?

Build if: you already own land, want a fully customized home, and have the patience to supervise construction. It can be cheaper in the long run if managed well.

Buy if: you want to move in immediately, have limited time to manage a project, or prefer a structured payment plan offered by developers, even at a premium price.

Both building and buying in Lagos are capital-intensive, but your decision depends on your financial flexibility, timeline, and appetite for project management. In a fast-growing city where property values keep rising, either choice is a solid investment, provided you verify documents and plan thoroughly.