Nigeria’s inflation picture is showing mixed signals as headline inflation continues to slow while food prices rise at a much faster rate.

The National Bureau of Statistics (NBS) reported a 50-basis-point decline in headline inflation to 15.43 per cent in July. At the same time, food inflation climbed from 17.52 per cent to 20.31 per cent.

The latest figures suggest that the easing in overall inflation has not yet translated into lower food costs for households. Food remains one of the largest expenses for many families, making the increase a major concern for household purchasing power.

Building Material Prices Surge as Inflation, FX Crisis Push Construction Costs Higher

Food inflation records sharp monthly increase

Food inflation also recorded a significant month-on-month increase in July.

The rate reached 5.56 per cent, compared with 3.75 per cent in June and 2.98 per cent in May. This marked the strongest monthly increase since the rebasing of the Consumer Price Index.

The year-on-year trend has also moved higher for six consecutive months. Food inflation started the year at 8.9 per cent but has since more than doubled.

The latest increase adds to concerns that food prices could remain a major source of pressure even as other parts of the inflation basket begin to stabilise.

Core inflation offers some relief

Core inflation provided a different picture in July.

The measure fell to 14.97 per cent, its lowest level since January 2025. The decline could support the Central Bank of Nigeria’s assessment that underlying price pressures are gradually becoming more stable.

The Monetary Policy Committee has maintained the Monetary Policy Rate between 26.5 and 27.5 per cent over the past year.

Money balances increased from N117.24 trillion to N133.25 trillion by June, representing year-on-year growth of 13.7 per cent. Private-sector credit also rose from N76.13 trillion to N83.26 trillion during the period.

The August inflation report will provide the MPC with newer data before its September meeting.

Transport costs add to food prices

High transport and energy costs remain important factors behind the food price increase.

Diesel prices have almost doubled since the end of February, according to the report. Diesel is widely used by logistics operators, making changes in its price important for the cost of moving agricultural goods.

Petrol prices have also increased by about 50 per cent since early March. Higher fuel costs can raise the cost of transporting food from farms to wholesale markets and then to consumers.

Insecurity in major food-producing areas has also created supply challenges. Economists, including Centre for Promotion of Private Enterprise Chief Executive Dr Muda Yusuf, have identified insecurity and logistics problems as structural issues affecting food prices.

Heavy rainfall may have added further pressure by making road transport and food distribution more difficult.

State inflation rates show wide gaps

The national inflation figure also hides major differences between states.

Adamawa recorded the highest headline inflation rate in July at 33.03 per cent. Yobe followed with 25.2 per cent, while Anambra recorded 24 per cent.

Nasarawa had the lowest headline inflation rate at 7.9 per cent. Kebbi and Borno followed with 9.1 per cent each.

Food inflation was particularly high in Adamawa, where it reached 51.4 per cent. Katsina recorded 30.8 per cent, while Zamfara posted 30.7 per cent.

The NBS has warned that state-level inflation figures should not be compared directly because household spending patterns vary across locations.

Housing costs face indirect pressure

The continuing rise in food prices also has wider implications for Nigeria’s housing sector.

When families spend more on food and transport, they have less money available for rent, mortgage payments, savings and home purchases. This can make housing affordability more difficult, especially for low- and middle-income households.

Developers also face higher operating costs when fuel, transport and other inputs become more expensive. These costs can affect construction budgets and, ultimately, the prices of new homes.

The July inflation figures therefore present a mixed outlook. While lower headline and core inflation point to improving price stability, rising food costs show that many Nigerians continue to face strong pressure on their household budgets.

The post Nigeria Food Inflation Climbs as Households Face Rising Living Costs appeared first on Housing TV Africa.

Nigeria’s cost-of-living crisis continues to put pressure on households as many Nigerians struggle to keep up with the rising cost of food, transportation and other basic necessities.

A report by Daily Trust, drawing on accounts from Nigerians and wider economic conditions, highlights the continued difficulty households face as the country moves closer to the 2027 general elections.

For many households, income growth has failed to keep pace with the cost of everyday living. Expenses that once consumed a smaller portion of household earnings now require greater financial sacrifices, forcing families to reconsider spending on everything from food to transportation and housing.

Housing remains part of the pressure

The cost-of-living challenge is closely connected to Nigeria’s housing problem.

As rents rise in major cities, households already dealing with higher food and transportation expenses have less disposable income available for accommodation.

For tenants, the challenge can be particularly severe when rent payments require large upfront commitments. Families may therefore have to move to cheaper neighbourhoods, share accommodation or accept longer commuting distances.

The result is a broader affordability problem in which the cost of living near jobs and essential services continues to rise.

Transport costs add to household expenses

Transportation is another major component of household spending.

When residents move farther away from employment centres in search of cheaper accommodation, they can end up spending more on daily transportation.

This creates a difficult cycle. Lower rent in an outer neighbourhood may be offset by higher transport costs, longer journeys and lost time.

For policymakers, this means housing affordability cannot be considered separately from transportation and urban infrastructure.

Election year puts living standards under scrutiny

With the 2027 elections approaching, economic conditions are likely to remain an important issue for voters.

The pressure on household budgets means that discussions around economic growth will increasingly be judged against people’s everyday experiences.

For many Nigerians, economic performance is ultimately measured by whether their income can cover food, housing, transport, healthcare and education.

The challenge for policymakers is therefore to translate broader economic improvements into tangible improvements in household purchasing power.

Housing policy needs a broader approach

The continuing cost-of-living pressure also reinforces the need for a more integrated approach to housing policy.

Increasing housing supply is important, but homes need to be located where people can access jobs, transport and essential services without facing excessive additional costs.

Affordable housing developments that are poorly connected to employment centres may solve one affordability problem while creating another through higher transportation expenses.

Nigeria’s housing strategy therefore needs to consider rent, construction costs, transport, infrastructure and household income together.

As the country moves toward the 2027 elections, the question will not simply be whether economic indicators are improving. For ordinary households, the more important question is whether those improvements are actually making everyday life more affordable.

The post Rising Living Costs Put Fresh Pressure on Nigerian Households appeared first on Housing TV Africa.

Despite a recent decline in food inflation across Nigeria, many residents of the Federal Capital Territory (FCT) continue to struggle with low purchasing power, making it difficult to buy staple food items.

Residents who spoke with the News Agency of Nigeria (NAN) attributed the challenge to limited income.

“Although some food items have slightly reduced in price, the difference is not yet significant due to low earnings,” they said. According to the National Bureau of Statistics (NBS), Nigeria’s annual food inflation rate dropped to 16.87 percent in September 2025, down from 21.87 percent in August, largely due to seasonal harvests of grains such as maize and millet.

At local markets, the reduction is evident: a bag of local rice dropped from N75,000 to N57,000, foreign rice from N90,000–N100,000 to N70,000, while a dustbin basket of pepper fell to N2,000–N2,300.

Despite this, many households reported that the lower prices have not translated into affordability. Civil servant John Okeke said, “If food prices have dropped, are they really affordable to the common man?

After paying rent, school fees, transport, and other expenses, little is left for household needs.”

Meanwhile, Minister of State for Agriculture and Food Security, Aliyu Sabi, attributed the price decline to improved local production and government intervention programs, including the National Agricultural Growth Scheme (NAGS) Agro-Pocket Programme, which injected over 500,000 metric tonnes of wheat, maize, cassava, and other crops into the market.

The post FCT Residents Struggle to Afford Food Despite Drop in Prices appeared first on Housing TV Africa.

Reliable household income data for emerging markets is often hugely challenging to find, particularly below national or state level.

There are many reasons for this scarcity. Firstly, many households operate within informal economies, where income may be irregular and hard to track. Secondly, there may be reluctance to disclose income, with people having concerns over government surveillance and tax implications. Thirdly, income data is often heavily biased dependant on the data collection method, with respondents potentially underreporting earnings. All these factors effect an emerging market’s ability to produce accurate income data that can inform effective policy making.

This is not only an issue in housing, but across many different industries and sectors. The absence of accurate income data creates significant hurdles for industries like housing, as affordability is a key criterion in meeting demand. To address this gap, Reall has developed a Household Income and Affordability Calculator, which offers much needed insights into income distributions and housing affordability in our priority markets (Kenya, India, Pakistan, Nigeria and Uganda).

Process

With support from Warwick Business School, particularly MSc Business Analytics student Vignesh Parthasarathy, Reall has extracted raw household consumption data (a common proxy for income) from large scale expenditure surveys undertaken by the national statistical offices of India, Kenya, Nigeria and Uganda, plus combined income and expenditure data from the Pakistan statistical office. By sorting the data by monthly household income/consumption and aggregating by sub-national and local regions, we were able to extract percentile figures from the data, giving a picture of household income across locations. Using median annual inflation data since 2010, we can then make broad predictions on current and future income levels.

Raw household data was downloaded from the website of each country’s Statistical office, with simple statistical analysis undertaken by Reall and Warwick Business School. The following surveys were used:

All surveys categorised households based on their county/district and whether this is an urban or rural area, meaning that data can be extracted for individual locations. Unfortunately, outside of the largest cities it is generally not possible to extract data for cities themselves; sometimes counties/districts consist of a single city, but generally they are made up of cities and their surrounding area, or cities comprise of multiple districts.

Additionally, care must be taken when looking at less populous counties/districts, where sample sizes can become too small. As an example, Kampala is the only city in Uganda where more than 100 households were surveyed.

Disclaimer; income and expenditure data is notoriously unreliable, particularly for wealthier groups, as stated in our introduction. This unreliability is multiplied when projecting this data to future years; inflation rates are a poor indicator of changes to income, particularly when those years include the COVID pandemic and the following global cost of living challenges. National inflation rates also mask significant variation across locations and across economic groups. This is discussed in more detail below in relation to Kenya.

This calculator is not attempting to provide definitive figures, but a rough estimation. It will continue to be built on as new surveys are released.

Results

All data below is inflated to 2024 using median annual inflation rates from 2010-23. Median rates were used rather than actual figures to help compensate for large-scale inflation across many economies in 2022 and 2023 (e.g. over 30% inflation in Pakistan in 2023 alone).

National data is presented below in current USD to enable international comparisons. However, Nigeria shows the problems with presenting data this way; since June 2023, Nigeria’s Naira has dropped from ~NGN 400 = USD 1 to ~NGN 1,600 = USD 1. As a result just eighteen months ago the median household income would be equivalent to ~US292/month rather than the USD73/month it equals now.

To compensate for rapid growth in incomes at the top of the income pyramid and improve legibility, graphs below show data for 20^th to 80^th percentiles.

All surveys contain data on number of individuals living in a household, and (other than the Kenya Continuous Household Survey) number of earners within a household. Other than in the case of Pakistan, mean household sizes were generally smaller than might be expected. There is also a significant difference in the mean number of workers between Uganda and Nigeria on one side, and the remaining countries on the other. This may go some way to explaining the slightly higher household incomes in Uganda compared with generally wealthier Kenya.

This national level data masks significantly higher incomes and often substantial differences across urban areas, which is demonstrated with Kenya and India below.

Comparing 2016 and 2020 Kenya Data

As highlighted earlier, the calculator contains data from two different Kenyan household surveys, undertaken by the same organisation using broadly standardised approaches and with similar numbers of households surveyed. This provides an opportunity to test the calculator’s approach to inflation.

We know that inflation is a poor way of measuring changes to household income and expenditure; it measures the changes to costs of goods, but not the quantity that households consume. It also reduces this change down to a single figure that masks what can be substantial differences across locations and income groups.

The graphs and table below inflate 2016 data to 2020, and compare this to actual 2020 data. We can see that at a National level, the inflated 2016 figures are quite substantially higher than the 2020 figures (over 40% higher at the 10^th percentile, and still 10% higher at the 90^th percentile). In fact, for the Bottom 20% of the income pyramid, non-inflated 2016 figures were higher than 2020 figures at a National level, creating a significant decrease in income/expenditure in real terms.

At county level, inflated 2016 figures surpassed 2020 figures in Nairobi for all income groups up to the 75^th percentile. Again, this was an over 40% difference at the 10^th percentile, though 2020 figures were 15% higher at the 90^th percentile. However, in Mombasa, 2020 incomes were higher than inflated 2016 figures for the vast majority of percentile groups. Clearly, further work is required to build a more robust approach to predicting future household incomes.

Predicting Maximum Affordable Housing Costs

Using simple adjustable loan terms on proportion of income available for housing, interest rate, down payment and tenor (number of years), the calculator predicts the maximum amount that a household at each income decile can spend on housing per month, and as a result, the maximum affordable home price.

This shows the disconnect between what markets are building and where the demand sits. In Nairobi, Kenya for example, even assuming that 30% of household income can be spent on housing (far above the average amount spent[1]), and subsidised interest rates of 9% over a 20-year period with a 20% downpayment, only 50% of the population can afford a home priced at $10,000 (KES 1.3m). See the Centre for Affordable Housing Finance in Africa’s ‘Housing Developments in the Nairobi Metropolitan Area’ dashboard to explore this gap in more detail.

Conclusion

Reliable household income data is vital in terms of understanding housing markets and targeting interventions. Reall’s Household Income and Affordability Calculator does not pretend to fully fill this gap, but aims to provide realistic estimations and projections that can be used to build market understanding.

Reall’s calculator can be accessed at www.reall.net/calculator, along with papers laying out the methodology used to extract relevant data from each survey. As we seek to incorporate new data and potentially new territories, it will become an increasingly powerful tool for exploring how housing finance can be used to reflect real incomes of families in our emerging markets.

We would love to hear your feedback, criticisms, and ideas for further improvements. Please reach out to ben.atkinson@reall.net.

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[1] See analysis undertaken by the Centre for Affordable Housing Finance in Africa (CAHF) and 71point4, which using the same 2016 Integrated Household Budget Survey found that renters in Kenya spend an average of 13% of income on housing –

The post Launching Reall’s New Household Income and Affordability Calculator appeared first on Housing TV Africa.