HDAN urges framework for regulating real estate developers,

Nigeria's real estate sector—valued at over $100 billion and responsible for 8–10% of GDP—operates in a largely unregulated environment that has cost investors billions in losses, abandoned projects, and fraud. The Housing Development Advocacy Network (HDAN), a coalition of industry stakeholders, housing advocates, and consumer groups, is now calling on the Federal Government to establish a formal, binding regulatory framework to govern developers, agents, and project financing across the nation's fragmented property market.

This advocacy comes at a critical moment. Property scams, incomplete construction, misappropriated funds, and unauthorized agent activities have eroded investor confidence and slowed capital inflow into residential and commercial real estate. Without standardized licensing, escrow requirements, and project disclosure rules, individual states—Lagos, Abuja, and Kaduna included—have attempted piecemeal solutions, leaving loopholes and cross-border arbitrage opportunities for bad actors.

## Why Does Nigeria Need a Unified Real Estate Regulatory Framework?

The current landscape is fragmented. The Real Estate Regulatory Authority (RERA) exists in Lagos and Abuja, but operates independently with limited enforcement power across state lines. Developers operating in Lekki, for instance, may be unknown in Enugu or Calabar, and verification of credentials is tedious. According to HDAN, at least 40% of listed agents lack formal accreditation, and escrow account oversight is minimal outside Lagos. A federal framework would create:

- **Unified licensing and vetting** of developers and agents.
- **Mandatory project registration** with standardized disclosure timelines.
- **Escrow account protocols** to protect buyer funds during construction.
- **Dispute resolution mechanisms** (arbitration, ombudsman services).
- **Anti-fraud audits** and financial transparency requirements.

## Market Impact: What Investors Should Expect

Regulation, when well-designed, typically increases market confidence and capital inflow. South Africa's Property Practitioners' Act, Kenya's Building and Construction Authority, and Ghana's regulatory initiatives have each stabilized their sectors post-implementation. Nigeria, given its scale and diaspora investment potential, could unlock $50–100 billion in additional investment if institutional safeguards were credible.

However, the immediate friction is real. Small and mid-sized developers—who account for roughly 60% of residential units delivered—will face compliance costs, licensing fees, and audit burdens. Some may exit the market; others will consolidate. This could temporarily reduce supply in secondary markets (Ilorin, Osogbo, Jos) where informal developers dominate, potentially driving short-term price volatility.

## HDAN's Call: What's Next?

HDAN is advocating for federal legislation under the Housing Ministry or a dedicated regulator, similar to the model used by the Financial Conduct Authority for fintech. The group has submitted position papers to the National Assembly and held stakeholder roundtables. Industry insiders expect a draft bill within 12–18 months, though parliamentary cycles and competing priorities mean implementation timelines are uncertain.

For investors, the takeaway is clear: **due diligence standards are tightening**, and regulatory clarity is becoming a competitive moat for large, transparent developers. Firms like Dangote Real Estate, UPDC, and Shelter Afrique are already positioning themselves as "regulation-ready," knowing that institutional buyers (pension funds, REITs, foreign investors) demand it.

The battle for Nigeria's real estate sector is shifting from laissez-faire to rules-based. Winners will be developers who embrace transparency early.

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