Precious Obogo
Africa’s real estate market is expected to grow 5.6 per cent annually through 2029, compared with a global average of 2.69 per cent.
This is according to a report by market research and consulting firm LEAF Africa.
The report showed that Africa still accounts for a modest share of the global real estate market, LEAF Africa sees the sector as a long-term growth frontier as mature markets in Europe, the Americas and Asia slow.
Rapid urbanization remains the main growth driver, however projections indicate that 60.4 per cent of Africans will live in urban areas by 2050, up from 44.5 per cent in 2025.
This shift should support long-term demand for housing, logistics warehouses, retail space, offices and infrastructure.
Nigeria alone faces a housing deficit of more than 28 million units, while Ghana faces a shortfall of about 1.8 million units. These gaps create investment opportunities for developers but also challenge policymakers to build more inclusive cities and improve housing affordability.
Rapid urbanization, population growth and the emergence of a large middle class should drive the expansion.
The report, titled “Real Estate Investment in Africa,” values the African real estate market at about $17.6 trillion, or roughly 2.7 per cent of global real estate value. Residential property dominates the market with an estimated value of $14.9 trillion. However, commercial real estate, office space and infrastructure supporting digital development are also gaining importance.
Nigeria leads Africa’s real estate market with an estimated value of $2.6 trillion. Its large population, rapid expansion of cities such as Lagos and Abuja, and growing residential and commercial demand support its position.
Egypt follows with $1.6 trillion, while Ethiopia ranks third with $1.3 trillion.
South Africa, which previously led the continental market, now ranks fourth with $1.2 trillion. Meanwhile, emerging markets such as Kenya, at $773 billion, and Ghana, at $533 billion, could drive the next phase of expansion through diaspora investment, dynamic urban centers and deeper regional integration.
Africa’s working-age population has also expanded rapidly, rising from 557.6 million people in 2008 to 866.3 million in 2024. Its share of the continent’s total population increased from 54.9% to 57.5% during the same period.
The sustained increase reflects a growing demographic dividend that should boost demand for real estate in African cities.
At the same time, Africa is developing a middle class with enough disposable income to seek better housing, higher-quality amenities and more attractive locations. The continent’s middle-class population could reach 500 million by 2030 and double again by 2060.
Diaspora remittances should provide another source of growth. Remittances reached $96.4 billion in 2024 and exceeded foreign direct investment in several African countries. A significant share of these funds goes toward real estate purchases, including homes, land and second residences.
For many Africans living abroad, real estate remains both an emotional connection to their countries of origin and a reliable store of value.
Infrastructure development also supports the market. Major roads, ports and industrial zones are transforming peripheral land into higher-value urban centers.
Moreover, economic and institutional reforms could strengthen Africa’s real estate sector.
Governments are improving access to mortgage finance, encouraging land-title regularization and offering tax incentives. These measures should increase private-sector participation in housing construction and mixed-use developments.
However, LEAF Africa says the market already shows signs of overheating despite its strong fundamentals. Inflation, currency depreciation and limited mortgage penetration, which remains below 5 per cent of GDP in most African markets, are pushing property prices beyond levels that income growth can support.
The supply imbalance adds to the pressure. Most available properties target the high-end segment, which remains disconnected from the purchasing power of the emerging middle class.
Average inflation in Africa reached 18.7 per cent in 2024, one of the highest rates globally, before falling to about 13.8 per cent in 2025.
At the same time, the continent’s economic growth remained moderate at 3.9 per cent, while currencies such as Nigeria’s naira lost more than 70 per cent of their value within a year.
Together with a 6.6 per cent increase in construction costs, these pressures are reshaping housing affordability, investment returns and the broader viability of Africa’s real estate market.