Housing attributes and the cost of private rental buildings in Lagos Nigeria: A hedonic price analysis

Abstract

While the hedonic analysis has been used extensively to analyze the housing markets in developed countries, it has relatively few applications to African housing markets. The need to study housing markets in Africa cannot be overemphasized. This paper presents the results of a hedonic price analysis of the Lagos, Nigeria, housing market. A Box-Cox transformation technique was employed for the analysis. Implicit prices for housing attributes were estimated to determine their impacts on rental rates in Lagos. The results indicate that both structural and environmental characteristics of a house affect its rent in Lagos. Further, structural characteristics appear to be more important than environmental characteristics in the market studied. These results are generally similar to the results obtained for developed countries, except that environmental attributes seem to be more important in developed countries than this study shows. Some policy implications of the hedonic analysis are briefly discussed.