Assessing the Performance of Nigeria’s Land Use Act in Facilitating Urban Land Markets

This study empirically assesses the performance of the Land Use Act of 1978 in facilitating or constraining urban land markets in Nigeria, examining its measured effects on land transaction costs, formal property market size, housing affordability, and private investment in real estate development. Despite extensive doctrinal critiques of the Land Use Act, empirical evidence on its actual market performance impacts remains limited, creating a gap between legal analysis and economic assessment. The study employs a quasi-experimental comparative analysis, exploiting variation in the implementation intensity of the Land Use Act's consent requirement provisions across states, and a survey of 200 property developers and 100 buyers across Lagos, Kano, Abuja, and Enugu. Transaction costs associated with right of occupancy consent are measured and compared against a counterfactual framework based on regional benchmarks. Regression analysis examines the relationship between state-level implementation intensity and private real estate investment volumes, housing price-to-income ratios, and formal sector building permit issuance. Results confirm that the consent requirement adds significant transaction costs averaging 8 to 15 percent of property value in states with strict implementation, acting as a brake on formal market activity and encouraging informal unregistered transactions. States with streamlined consent procedures show higher formal building permit volumes. The study provides novel empirical evidence to support Land Use Act reform advocacy, demonstrating measurable market efficiency costs of the current framework. Keywords: Land Use Act, land market, transaction costs, property rights, Nigeria.