How Property Valuation Works in Nigeria: A Beginner's Guide

Property valuation is a crucial aspect of real estate, providing a basis for informed decision-making whether you're buying, selling, investing, or using a property as collateral for a loan. In Nigeria, valuation is more than just attaching a price to a property—it involves a professional and systematic process backed by legal and professional standards.

If you're new to the Nigerian property market, this guide will help you understand how property valuation works and why it's so important.

What Is Property Valuation?

Property valuation is the professional process of determining the monetary value of a property at a given point in time. It takes into account various factors including location, size, use, condition, market trends, and legal status.

In Nigeria, property valuations are carried out by registered Estate Surveyors and Valuers (ESVs), who are licensed professionals regulated by the Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON) and members of the Nigerian Institution of Estate Surveyors and Valuers (NIESV).

Why Is Property Valuation Important in Nigeria?

Valuation plays a key role in several real estate transactions and decisions, including:

Property sales and purchases

Securing mortgage loans

Tax assessments

Rental pricing

Asset management

Compensation for compulsory acquisition

Given the evolving and sometimes unpredictable nature of Nigeria's property market, a valuation report offers objectivity and professionalism.

Key Steps in the Property Valuation Process

Here’s how a typical property valuation works in Nigeria:

1. Client Briefing

The process begins with a briefing from the client. This could be a property owner, a buyer, a bank, or a legal entity. The valuer gathers information about the purpose of the valuation—whether for sale, mortgage, tax, insurance, or investment.

2. Property Inspection

The valuer visits the site to inspect the property. This includes:

Measuring land and building areas

Assessing the physical condition

Noting the type of construction

Checking infrastructure and facilities

Reviewing access roads and surrounding developments

3. Document Verification

Legal and title documents are reviewed to confirm ownership and any encumbrances. In Nigeria, the quality of documentation—such as C of O (Certificate of Occupancy), Deed of Assignment, or Governor's Consent—can significantly influence value.

4. Market Analysis

The valuer researches the current market conditions in the property’s location. This includes:

Prices of similar properties recently sold or leased

Demand and supply trends

Infrastructure developments (e.g., roads, power, drainage)

Government policies that may affect value

5. Selection of Valuation Method

The appropriate method depends on the property type and use. Common methods include:

Comparative (Sales) Approach – for residential or commercial properties

Income Capitalization – for income-generating properties like rentals

Cost Approach – for special-use properties or new constructions

6. Valuation Report Preparation

The findings are compiled into a formal valuation report, which includes:

A summary of the property

Description of methodology used

Basis of value

Assumptions and limitations

Final opinion of value

This report is signed and stamped by a registered valuer and can be used for official purposes.

Unique Factors Influencing Valuation in Nigeria

Title & Documentation: Insecure land titles or unresolved disputes can reduce property value.

Infrastructure: Availability of water, roads, and power supply can drastically affect valuation.

Security Situation: In regions facing insecurity, valuation may reflect the risk level.

Government Policies: Urban development plans or demolition threats can either boost or reduce value.

Market Distortions: Informal market activity and speculation may skew prices in some areas.

Conclusion

Understanding how property valuation works in Nigeria is essential whether you're a first-time buyer, a seasoned investor, or a developer. It provides clarity, reduces risk, and supports smarter decision-making.

Always ensure your valuation is conducted by a certified and experienced estate surveyor and valuer to get the most accurate and legally recognized outcome. In a dynamic real estate environment like Nigeria, professional valuation isn't just useful—it's necessary.