Let’s be real for a second. The phrase “rent is due” is probably one of the most stressful in the entire Nigerian-English vocabulary.
For many young professionals in Nigeria, especially in places like Lagos, Abuja, or Port Harcourt, the dream of homeownership feels… well, like a dream. A far-off, expensive, and slightly impossible-sounding dream. We’re often told it’s the ultimate sign of “making it,” yet we live in a reality of eye-watering annual rents, agent fees that make no sense, and landlords who wake up one morning and decide your rent needs to double.
If you feel like you’re stuck on a rental treadmill, you’re not imagining things. The statistics are staggering. Nigeria was said to be grappling with a housing deficit estimated to be over 28 million units as of 2024, and according to the World Bank, Nigeria’s homeownership rate is only around 25%, one of the lowest in Africa and a far cry from the 84% in Kenya or 90% in Indonesia.
So, you’re not just feeling the squeeze; the data proves it’s real.
But here’s the good news: it is not impossible. It just requires a different set of rules.
Most of our parents might have bought land and then built their houses block by block, but home ownership in our time requires a different approach. It requires smarter financial habits, a clearer plan, and a new way of thinking about financing.
This isn’t a guide on “how to buy a house by next weekend.” This is a clear guide on how to actually plan for home ownership in your 20s and 30s, and build the financial habits to make it happen.
First, Let’s Have a Reality Check: Why Even Bother?
In a country with high inflation which only recently dropped to about 16%, saving cash can feel like you’re trying to fill a bucket with a hole in it. Your ₦1 million saved today will have significantly less buying power in a year.
So, why buy a house?
- It’s Your Best Inflation Hedge:While your Naira in the bank is losing value, a well-placed property gains value. Real estate in Nigeria has historically outpaced inflation. That house in a decent location won’t just hold its value; it will likely grow, protecting your wealth from being eroded.
- You Stop “Losing” Money:Think about it. Every rent payment you make is a 100% loss. It’s the cost of access to a property. When you start paying for your own home, that same money starts building equity, your ownership stake in an asset. You’re paying yourself, not just your landlord.
- The Unbeatable “Peace of Mind” Factor:No more “urgent 2k” for the compound security you already paid for. No more waking up in a panic 11 months into your rent cycle. The stability and psychological freedom of owning your space are, quite frankly, priceless.
The Money Habits: How to Prepare Your Financial ‘War Chest’
Most people can’t just wake up and decide to buy a house. It’s a goal that starts with small, consistent habits, years in advance.
Habit 1: Know Your Numbers
You must know where your money is going. Not in a vague “I spend on food” way. We’re talking specifics. Use a budgeting app or a simple spreadsheet and track everything for 30 days.
This isn’t about judging yourself for buying shawarma. It’s about finding the “leaks.” You might be shocked to find that “small” data, Ubers, and subscriptions are adding up to ₦100,000 a month; money that could be your “House Fund.”
Habit 2: Automate Your “House Fund” Immediately
“I’ll save what’s left over” is a fantasy. The single most effective way to save is to Pay Yourself First.
The moment your salary lands, have an automatic transfer set up. This money should go into a separate, dedicated account that you do not touch. Label it “House Fund.” This isn’t your emergency fund (you need that too!). This is a long-term, sacred savings pot. Make it automatic, and you’ll save money without even feeling it.
Habit 3: Understand the Different Costs Involved
This is where most first-time buyers get stuck. The price of the house is not the final price. In Nigeria, you must plan for three costs:
- The Down Payment:This is the percentage of the property’s value you must pay upfront. For most financing plans, this ranges from 10% to 30%.
- The Legal Fees:You need a sharp lawyer to verify the property’s title (C of O, etc.) and draft the contract (Deed of Assignment). This can be 5% to 10% of the property’s value.
- Agency & Other Fees:The agent who “showed” you the house will want a fee, typically 5% to 10%.
This means for a ₦30 million property, you don’t just need ₦30 million. You need a down payment (e.g., ₦6 million) plus another ₦3-6 million for all the associated fees. Knowing this “Real Number” changes your savings goal entirely.
The Big Question: How Do You Actually Pay for It?
So, you’ve saved your ₦10 million down payment. You’re ready. But the house is ₦40 million. How do you cover the rest?
This is where the path splits.
The “Old” Way: For decades, the only option was a traditional, interest-based mortgage. This was a loan. You’d borrow the ₦30 million, and then pay it back with interest. The problem? That interest is often high; it compounds.
The “New” Way: Ethical, Non-Interest Finance: This is where the game changes for young professionals. As an ethical, non-interest bank, we believe in a different model. It’s not about lending you money; it’s about partnering with you to achieve your goal.
This is the principle behind a solution like AltHome, Our Home Finance solution.
It’s not a “loan” in the traditional sense. The idea is beautifully simple:
- You Find the House:You do your research and find the property you love.
- We Partner Up:You provide your down payment (your equity), and the bank provides the rest of the funds to acquire the property.
- You Pay in Installments:You then buy the bank’s share of the property from us over an agreed-upon period through comfortable, predictable installments.
This is such a gamechanger because it’s accessible and transparent. There’s no variable interest rate that can change and give you anxiety. You know exactly what you will pay from Day 1 to the final payment. It’s a partnership. We’re in it with you. The entire process is built on clear and fair principles.
This home financing option opens the door for millions of young professionals, especially those in the “missing middle” who earn a good salary but don’t have ₦40 million in cash to get on the property ladder.
The Hunt: A Simple Guide To Finding The Right Home
Now that you’ve built the finance habit, and you’ve gotten a finance partner, let’s talk about things to look out for when choosing the house.
- Be weary of the “uncompleted” options:Be extremely careful with off-plan (uncompleted) developments. While some are legitimate, many are traps. For your first home, it’s often safer to buy a completed or near-completed property you can see and touch.
- Location, Infrastructure, and Title:Don’t just fall in love with the beautiful kitchen tiles. Is there a good road? Does the area flood in the rainy season? (A real question in Lagos!). And most importantly, what is the title? Insist on a “clean” and verifiable title (like a C of O), which protects you from “Omo-Onile” (land-grabber) issues.
- Think Long-Term:Don’t just buy for the “you” of today. Is this a 1-bedroom flat you’ll outgrow in two years? Or a 2-bedroom you can grow into, or easily rent out later? Think of your first home not just as a place to live, but as a major investment.
Your Journey Starts Today
The path to homeownership in Nigeria is a marathon, not a sprint. But it’s a marathon you can win. It starts not with ₦40 million, but with the first ₦50,000 you move into your “House Fund.” It starts with the first budget you write and stick to. It starts with the first time you say “no” to a small purchase to say “yes” to your big future.
The dream of holding your own set of keys, free from the stress of rent, is closer than you think. It just takes a new set of habits and a new kind of partner.
