ABUJA, Jan 10 (AGCNewsNet) – Nigeria’s real estate sector has surpassed oil and gas to become the third-largest contributor to the nation’s economy, according to early data from the ongoing Gross Domestic Product (GDP) and Consumer Price Index (CPI) rebasing.

The rebasing exercise, initiated by the National Bureau of Statistics (NBS), aims to reflect updated economic realities. Crop production and trade have emerged as the largest and second-largest sectors, respectively, while telecommunications has become a standalone sector, ranking fourth.

Real estate recorded significant nominal growth of 46.52% in Q3 2024 compared to the same period in 2023, despite challenges such as declining purchasing power and a housing deficit estimated at 28 million units. The sector contributed 5.43% to real GDP in Q3 2024.

The rebasing exercise has separated crop production from agriculture, positioning it as a leading industry in Nigeria. Agriculture, which includes livestock, forestry, and fishing, contributed 28.65% to overall GDP in Q3 2024.

Trade followed with a 14.78% contribution, while telecommunications, now categorized independently from information and communication, accounted for 16.35%.

Crude petroleum and natural gas, once dominant, have been relegated to fifth place, with construction, food beverages and tobacco, and other sectors filling out the top seven. Public administration has been displaced entirely.

Nigeria’s real estate market is projected to reach $2.61 trillion in value by 2025, according to Statista. Residential real estate dominates the sector, with an anticipated market volume of $2.25 trillion by 2025. The market is expected to grow at a compound annual growth rate (CAGR) of 6.91% from 2025 to 2029, potentially reaching $3.41 trillion by 2029.

Luxury apartments in major cities are experiencing surging demand, signaling strong potential for further growth.

The last GDP rebasing, conducted in 2014, resulted in a nearly 90% increase in Nigeria’s GDP, establishing it as Africa’s largest economy. The ongoing rebasing exercise uses 2019 as its base year and incorporates emerging industries such as the digital economy, modular refineries, and pension fund administration.

NBS CEO Adeyemi Adeniran emphasized the importance of accurate data in policymaking and strategic planning, stating, “Rebasing ensures our economic indicators reflect the current structure of our economy, incorporating new and emerging sectors and updating our consumption baskets.”

Economic experts see the rebasing as crucial for improving the accuracy of key metrics such as tax-to-GDP and debt-to-GDP ratios. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise (CPPE), noted the need to address imbalances in sectoral growth contributions, which can distort the overall picture of economic health.

Analysts from CardinalStone Research predict the rebasing may reduce the size of the informal economy and adjust the weighting of certain components, such as food price changes, in inflation calculations.

With real estate now a major player, Nigeria’s economic trajectory underscores the growing importance of diversification and the need for targeted policies to unlock the full potential of its emerging sectors.

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