Lagos’ short-let market generated an estimated N281.03bn in revenue in 2025, holding steady despite high inflation and intensifying competition, according to a report from Edala Development.

The Lagos Shortlet Market Report 2025 notes that while the sector’s phase of rapid, unregulated growth is ending, it remains a key contributor to the city’s real estate economy, with revenues projected to climb to N285.5bn in 2026.

Population growth and economic scale continue to underpin demand. With nearly 27 million residents, Lagos is Africa’s largest commercial hub and a magnet for both domestic and international investors.

According to the new report, Lekki is the largest revenue driver, with Phase I and Phase II accounting for nearly N165bn combined in 2025, followed by Victoria Island, whose revenue nearly doubled to N34.8bn.

Meanwhile, Banana Island experienced a sharp decline, dropping to N9bn due to regulatory suspensions, with projections for 2026 showing a further fall to N1.5bn as short-let activities were completely suspended as of February 2026.

“The Lagos short-let market is transitioning from a boom driven by opportunistic growth to a more professional, compliance-driven industry,” the report stated. Success in this new phase now relies on strategic investment, professional management, and adherence to stricter estate regulations, it added.