In Nigeria, all land is technically owned by the state — not by individuals or companies. This is the foundational principle of the Land Use Act 1978, which vested all land in each state in the Governor of that state, held in trust for all Nigerians. What this means in practice is that all land rights in Nigeria are, technically, a form of leasehold — a right of occupancy granted by the state, not absolute ownership. Understanding this principle helps you understand the C of O, Governor's Consent, and other aspects of Nigerian property law.
The Land Use Act 1978 and state ownership of land
Section 1 of the Land Use Act 1978 provides: "Subject to the provisions of this Act, all land comprised in the territory of each State in the Federation are hereby vested in the Governor of that State and such land shall be held in trust and administered for the use and common benefit of all Nigerians in accordance with the provisions of this Act."
This means that no matter how long a family has owned land, no matter what traditional title they hold, and no matter what document they have — the ultimate ownership of all land in Nigeria sits with the state. Individuals and companies can hold a right of occupancy — which is the official grant of land use rights from the state — but not outright freehold ownership in the way that concept exists in countries like the UK or USA.
What is a right of occupancy?
A right of occupancy is the formal grant of land use rights under the Land Use Act. It is what the Certificate of Occupancy (C of O) documents. There are two types:
- Statutory Right of Occupancy: Granted by the Governor (State Government) for urban land — this is what is evidenced by a C of O. The standard term is 99 years, renewable. This gives the holder the broadest set of practical ownership rights.
- Customary Right of Occupancy: Granted by the Local Government for non-urban land, recognising customary occupation and use. Different from a C of O in terms of strength and formality.
For a detailed breakdown of these two types, see our Right of Occupancy guide.
Is a 99-year C of O actually "ownership"?
In practical terms, yes — a 99-year C of O is treated as the functional equivalent of ownership in the Nigerian market. The holder of a valid C of O can:
- Sell the property (with Governor's Consent for the transfer)
- Mortgage the property (with the Governor's Consent or as collateral under a bank mortgage)
- Lease or sub-let the property
- Develop and build on the land within zoning rules
- Pass it to heirs on death
- Apply for renewal at the end of the 99-year term
The only meaningful practical differences from "freehold" are: the requirement for Governor's Consent for sales and mortgages, the payment of ground rent to the state, the covenants in the C of O that restrict certain uses, and the theoretical possibility of revocation by the government in defined circumstances.
How Nigerian leasehold differs from UK leasehold
This is important for Nigerians in the diaspora and international buyers familiar with UK property law:
| Factor | Nigerian C of O (leasehold) | UK Leasehold |
|---|---|---|
| Lessor (landlord) | State Government | Private freeholder |
| Standard term | 99 years, renewable | Varies (125, 250 years — reduces over time) |
| Term runs down to zero? | No — renewable | Yes — eventually reverts to freeholder |
| Service charge? | No (except within managed estates) | Yes — from freeholder |
| Consent to sell? | Governor's Consent required | Freeholder consent may be needed |
| Revocation risk | Possible for breach or public interest | Forfeiture for breach (rare) |
Practical implications of Nigerian leasehold for buyers
- Governor's Consent: Every time a C of O property is sold or mortgaged, the state government must consent. This is an additional step and cost in every transaction. See our Governor's Consent guide.
- Ground rent: C of O holders owe annual ground rent to the state — typically a modest amount, but failure to pay over many years can result in arrears and, in extreme cases, revocation notices.
- Revocation risk: The government can revoke a C of O for non-payment of ground rent, breach of the conditions of the grant, or for overriding public interest (with compensation). This risk is generally low for legitimately occupied residential property, but it is a structural difference from absolute ownership.
- Renewal: At the end of the 99-year term, application must be made for renewal. This is not automatic but is generally expected to be granted for legitimate holders in good standing.
Related guides: Certificate of Occupancy Nigeria, Right of Occupancy Nigeria, Governor's Consent Nigeria, Land document types in Nigeria.
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