Ikoyi land prices hit N6m per square metre as Oak Holdings CEO questions the economics

Land prices in Ikoyi have risen to about N6 million per square metre, up from between N1.8 million and N2 million three to four years ago, according to Olukayode Olusanya, founder and CEO of Oak Holdings. He questioned the economic basis for the increase during the latest Drinks & Mics episode themed “Cars, Homes & Wahala: Why Is the Nigerian Dream So Expensive?”

No science, just feelings?

Olusanya said Ikoyi land prices have risen about threefold in three to four years. He argued there is no clear science backing the rise. He said the process can start with an individual property owner deciding their land should command a higher price.

“As at, three, four years ago, to buy a parcel of land in Ikoyi, conservatively, you will get between N1.8 and N2 million Naira per square meter, which is one by one. Now, Ikoyi is on N6 million per square meter.”

“I can tell you for a fact that there’s no science backing it up. And it always starts from somebody’s feelings. Somebody just sleeps and wakes up and believes I can sell at this price,” Olusanya said.

He added: “We say supply and demand and all that, you know, you can argue all of that so long as you want. But in this part of the market, in Ikoyi part of the market, I can tell you there’s no science driving it.”

He said the process often starts in areas such as Banana Island, where a property owner can set an asking price. When another buyer agrees to pay it, the completed transaction becomes a reference point for other sellers and creates a new market benchmark.

Expert disagrees

Sanni Faruq, Lead Consultant at Senior Homes and Properties, disagreed. He argued real estate pricing is governed by economic principles, including the law of demand. A willing buyer and willing seller at an agreed price means market forces are at work, he said.

“Buying and selling is governed by the economic law of demand, which is a science itself. So far there is a willing buyer and willing seller at a particular price, the purchase and sale of the property is effectively backed by science. Lagos real estate is driven by massive demand faced with a very short supply. So far this continues, the price will always be on an upward trend,” Faruq said.

Lagos among Africa’s priciest markets

Estate Intel ranked Lagos as the second-most expensive market for prime residential land in Africa. It said US$1 million buys about 507 square metres in Lagos, behind Cape Town, where the same amount buys about 329 square metres. The analysis covered 11 major African cities and prime residential locations including Ikoyi, Victoria Island and Lekki Phase 1. It linked high prices to strong demand for prime locations, limited land and infrastructure gaps that concentrate demand in areas with relatively better infrastructure. Developers of luxury residential projects are competing for a limited number of prime sites, while strong sales, occupancy and profit margins have encouraged more land acquisition.

Average prime land prices in Lagos exceed US$1,900 per square metre, Estate Intel said. Johannesburg was the most affordable of the 11 cities surveyed, with US$1 million buying about 4,537 square metres, compared with 507 square metres in Lagos. The figures are based on prevailing prices in selected prime residential locations and do not represent typical plot sizes across the cities.

Premium for dysfunction

High prices do not necessarily mean better public services. The State of Lagos Housing Market Report 2025 Vol. 3 identified Ikoyi, Banana Island, Victoria Island and Lekki Phase 1 as high-end neighbourhoods where residents still face unreliable water supply and frequent power outages. It also flagged inadequate drainage and poor waste management. Many residents rely on private boreholes, water tankers and diesel generators. The report described the situation as a “premium for dysfunction”.