The cost of renting a two-bedroom apartment in some of Lagos Island’s most sought-after neighbourhoods has surged sharply, with annual rents now reaching as high as N17.25 million in 2026.

According to Nairametrics, a new Lagos Island Residential Market Report 2026 by real estate firm Lagos Realty shows that rental prices have risen substantially across Ikoyi, Victoria Island, Lekki Phase 1 and Ikate over the past four years.

The report, which tracks rental prices, property values and land costs between 2022 and 2026, shows that Ikoyi is the most expensive of the four locations, while Ikate remains the least costly despite recording the fastest percentage increase.

Ikoyi, Victoria Island lead rental costs

According to the report, tenants seeking a two-bedroom apartment in Ikoyi now pay an average annual rent of N17.25 million, compared with N8 million in 2022. This represents an increase of 115.63 per cent.

Ikoyi’s premium residential market is driven by its concentration of luxury homes and its appeal to diplomats, senior executives, expatriates and high-income households.

The report noted that some luxury apartments are priced in US dollars, while new developments have expanded the supply of high-end residential units. Victoria Island ranks second, with average annual rent reaching N15 million in 2026, up from N6.57 million four years earlier.

The increase amounts to 128.31 per cent. The area’s combination of commercial and residential activity continues to support rental demand, particularly among corporate tenants, expatriates and young professionals. New mixed-use developments around the Eko Atlantic boundary and Ozumba Mbadiwe corridor are also reshaping the residential market.

Lekki Phase 1, Ikate see steepest growth

In Lekki Phase 1, the average annual rent for a two-bedroom apartment has climbed to N10 million from N4 million in 2022, representing a 150 per cent increase.

The report described the neighbourhood as the most transactionally active among the four markets, attracting young professionals, families and members of the Nigerian diaspora returning to the country.

Infrastructure improvements, continued housing development and relatively lower rents compared with Ikoyi and Victoria Island have helped sustain demand.

Ikate recorded the lowest average rent at N8.5 million annually, but it posted the biggest percentage increase over the period. The figure is up 183.33 per cent from N3 million in 2022.

The report linked the growth to rapid residential development, with apartment towers and gated estates increasingly replacing low-density housing.

Lagos Housing costs continue to rise

Overall, the report shows that annual rents for two-bedroom apartments across the four Lagos Island locations now range from N8.5 million to N17.25 million.

All four areas recorded rental increases of more than 100 per cent between 2022 and 2026, highlighting the growing pressure on tenants in some of Lagos’ most desirable neighbourhoods.

The sharp rise reflects strong housing demand, expanding luxury developments and limited availability of land and new residential units, factors that continue to push rental costs higher across the Lagos Island property market.