Land Banking Practices in the Lagos Real Estate Market Practices

Al-Ameen Ayoade  Okonu; Modupe  Omirin; Obinna Lawrence  Umeh; Oluwaseun  Muraina

Al-Ameen Ayoade Okonu Department of Estate Management, University of Lagos
Modupe Omirin Department of Estate Management, University of Lagos
Obinna Lawrence Umeh Department of Estate Management, University of Lagos, Nigeria
Oluwaseun Muraina Department of Estate Management, University of Lagos, Nigeria

Keywords: Land banking, Real estate market,, Regulation, Lagos, Development

Abstract

Land banking, a practice among real estate developers that is gaining traction in Lagos, involves holding land for future development. However, it has been observed that the practice has several negative consequences in the real estate market. This study seeks to examine the effect of land banking practices in the Lagos real estate market with a view to providing a guide on ways to regulate the practice. The study sampled 203 Estate Surveyors and Valuers, 63 Academics and 58 Land Officers using a simple random sampling technique. The data garnered was analysed using the Mean Item Score. The findings reveal a high prevalence of land banking among property developers, leading to significant negative impacts, including inflated land prices, artificial scarcity and increased market speculation. While 40% of respondents oppose land banking, opinions vary on its potential benefits when managed strategically. The study
further identifies key regulatory measures to mitigate the adverse effects of land banking, such as implementing taxes on vacant land, establishing a transparent land register and enforcing landholding limitations under the Land Use Act of 1978. Additionally, the role of government in mass housing provision is emphasized as crucial for increasing the housing supply and improving accessibility. The recommendations aim to create a balanced regulatory framework that discourages speculative practices while promoting sustainable urban development.