Cost of Cement Rises to N8,800 Amid Skyrocketing Building Material Prices

The cost of building materials in Nigeria has risen sharply, exacerbating the country’s already dire housing crisis and threatening to undermine the government’s efforts to provide affordable homes for citizens.

As of October 2024, the price of cement, a key construction material, has surged from N4,000 to N8,800 per bag, marking a 100% increase in just one year. Other materials like blocks, iron rods, and paints have also seen massive price hikes.

Blocks, which sold for N250 last year, now cost between N550 and N600, while the price of iron rods has doubled from N800,000 per ton to N1.6 million. Once priced between N23,000 and N25,000, paint is now retailing at N46,000 to N50,000.

The soaring costs are causing significant disruptions in the construction industry, with both private property developers and individual homeowners struggling to complete projects.

Developers have had to halt ongoing constructions, and many are rethinking their budgets or seeking new financing strategies.

The situation is further compounded by the country’s high inflation rate, which hit 32.70% in September 2024, the highest in years, driven largely by rising transportation costs and food prices.

For civil servants like Joshua Oluwatobi, these price hikes are a crushing blow to hopes of owning a home. “Most of us who are civil servants can no longer afford to build a home after retirement,” he said. “From iron rods to cement, everything is beyond us now, and we need the government to intervene.”

Construction workers are similarly impacted, with some putting projects on hold due to the inability to afford materials. One builder, who began his project in 2018, explained, “Every day, the costs of materials rise, and it’s impossible to keep up. I’ve had to stop work on the building until prices come down, if they ever will.”

Retailers are also feeling the pinch. Chijoke Ani, a building material seller, said, “Customers only call to inquire about prices now. No one is buying because they’re waiting for prices to reduce.”

Similarly, Moses Dala, another retailer, pointed to the rising transportation costs as an additional burden. “We now pay millions to transport cement from one place to another,” he said.

Real estate developers are also concerned that these price hikes will make the government’s promise of affordable housing a distant dream.

Musa Ibrahim, a property developer, warned, “Affordable housing for all will remain a mirage unless the government takes drastic steps to control prices.”

He added that landlords also capitalise on the situation, raising rents to cover increased building costs.

Khalid Usman, a developer in Kano, has laid off workers due to the unsustainable costs. “The business is no longer viable with daily increases in the cost of materials,” he said, urging the government to intervene. “Housing for the people should be a priority for the government, but without price controls, this will remain an impossible goal.”

Experts argue that prices will continue to soar until the government addresses the foreign exchange market’s instability and subsidy removal policies.

Osilama Osilama, Vice President of the Real Estate Developers Association of Nigeria (REDAN), pointed to the sharp depreciation of the naira, which has exacerbated the situation.

“Last year, the naira was at N460 to $1, but now it’s N1,700 to $1. Most building materials are imported, so how can prices come down?” he asked.

Osilama also stressed the need for the government to support local manufacturing of building materials to reduce reliance on imports.

“Funding for the Nigeria Building and Road Research Institute (NIBRRI) must be increased to help develop local materials and conserve foreign exchange,” he suggested.

The government has acknowledged the crisis, with the Minister of Housing and Urban Development, Ahmed Dangiwa, holding meetings with cement manufacturers to address the rising costs.

In February 2024, Dangiwa questioned the sharp increase in cement prices, especially since local producers source most of their raw materials domestically.

He also announced plans to establish manufacturing hubs in Nigeria’s six geopolitical zones to help reduce material costs and make housing more affordable.

However, real estate developers and citizens alike remain sceptical about the effectiveness of these measures.

Until more substantial action is taken to address the root causes of the price hikes, affordable housing for all Nigerians will remain elusive.