Inflation is one of the most misunderstood forces in investing. Many people assume inflation is bad . To the investor, it is not bad, but to the day-to-day consumers, it can be a devastating moment in the grand scheme of things.
Inflation can be your best friend OR your worst enemy, depending on what you invested in. To understand this, let’s look at how inflation works in Nigeria and what it means for real estate investments in 2025–2026.
Nigeria’s Inflation Is Not Normal, It’s Structural
Nigeria’s inflation has been rising at a pace far beyond global averages.
Key Facts:
- Nigeria’s inflation crossed 33%+ in 2024–2025 (highest in 30 years).
- Food inflation went above 40%.
- The naira moved from ₦740/$ → ₦1,500/$ → ₦1,900/$ within 18 months.
- Diesel, building materials, logistics, labor, and rents skyrocketed.
This shows one thing clearly: The naira is losing value faster than any savings account or fixed-income asset can grow.
Meaning, If your money is sitting still, you are losing money every second. However, Naira seem to maintain a consistent rate so far.
Who Gains From High Inflation?
Inflation punishes savers but rewards people who own:
- Real estate
- Rental property
- Short-stay units
- Land
- Revenue-generating assets
- Dollar-priced assets
- Businesses that can adjust their pricing
Inflation raises the price of assets and raises the cashflow from those assets.
How Inflation Has Affected Rent in Nigeria (2019–2025)
Here is the actual pattern investors need to understand: Rent growth has outpaced salary growth by 200%+. In Lagos:
- A mini-flat in Yaba that cost ₦500k in 2019 is now ₦1.5M – ₦2.2M.
- A 3-bedroom in Lekki that was ₦2.5M is now ₦6M – ₦10M.
- Short-let apartments that made ₦18k per night on the mainland in 2020 now make ₦45k – ₦75k.
This is because landlords adjust rent to inflation immediately, but salaries don’t. This is why real estate investors survive inflation while renters suffer it.
The Dollar Rate Has Become the New Driver of Real Estate Profit
Before, Nigeria’s real estate only followed local inflation. Now, it follows:
- Dollar rate
- Inflation
- Construction cost
- Demand from diaspora investors
Let’s break this down.
When the dollar rises:
- The cost of cement, steel, tiles, and fittings increases.
- Developers increase property prices.
- Rent follows property cost.
- Short-stay prices adjust immediately.
- Airbnb and Zimmr-like stays peg prices partly to dollar demand.
This means: If the naira falls, property owners make more money, automatically. But people with cash savings lose. That is why investors look for assets that:
- Adjust price with inflation
- Are indexed to the dollar
- Generate revenue daily
- Do not depend on salary earners
Short-stay real estate fits this category.
Why Traditional Rentals Are Less Profitable During Inflation
Even though rent goes up, landlords still face these issues:
- Rent is fixed for 12 months
- Inflation eats the value of that rent
- Tenants delay or default
- Property loses value in real terms if pricing is poor
- Owners cannot adjust monthly like shortlets can do
This creates a contradiction: Rent increases, but your profit does not keep up with inflation.
This is why smart investors are shifting toward flexible models.
Why Short-Stay (Airbnb / Zimmr) Beats Inflation in Nigeria
Short-stay rental revenue is not fixed. It moves with the market in real time. 3 reasons short-stay thrives under inflation:
1. Daily pricing adjusts instantly
If diesel goes up today, the price per night goes up in time.
2. Foreign travelers pay in dollars
This hedges against naira volatility.
3. Occupancy increases during economic volatility
People travel more for:
- Business
- Inter-state movement
- Emergencies
- Government work
- Project contracts
Terminals like Zimmr’s interstate traveler accommodation model capture this demand effortlessly.
Does Inflation Bring Profit?
For people holding cash or salary earners → NO. You get poorer. Your purchasing power is destroyed. For real estate investors → YES. Inflation increases your asset value.
But only if you hold assets that:
- Are in high demand
- Generate cashflow
- Are not locked into long-term fixed pricing
- Adjust to inflation in real time
Practical investor takeaways
- Prefer income-generating assets that reprice frequently.
Short-stays, serviced apartments, hospitality pods, and facilities that can change nightly/monthly rates are good hedges.
- Seek dollar or hard-currency exposure if possible.
Dollar-earning guests (tourists, foreign business) protect revenue. Consider partial dollar indexing in contracts or dynamic pricing pegged to exchange movements.
- Avoid long, fixed rent contracts without indexation.
If you must take long-term leases, negotiate CPI or FX indexation.
- Factor in rising OpEx & CapEx.
Construction materials, power, and logistics costs rose in 2024–25. Build contingency buffers + productivity improvements (solar, efficient fixtures).
- Operational excellence matters.
Inflation punishes sloppy operators. Automate operations, control leakage, reduce idle periods. This is one reason vertical, managed models like Zimmr are attractive — they centralize management, pricing, and distribution.
- Timing & valuation:
Early equity in asset-backed, revenue-generating projects launched before or during a re-rating (as costs rise) can capture outsized nominal gains.
Zimmr’s Investment Snapshot
| Features | Details |
| Model | Hospitality real estate for business travelers |
| Location | Lagos (Oshodi, Ojota, Yaba Terminals) |
| Entry Cost | ₦1 million minimum |
| Project Value | ₦50 million (11-bed facility) |
| ROI Projection | Up to 10x in 5 years |
| Investment Deadline | January 2026 |
| Investor Access | Verified equity participation |
| Waitlist | 100+ early-stage business travelers and investors |
Invest with a minimum of 1 Million and improve your investment returns.
