You're scrolling through your bank app at midnight. Your rental property in Lagos brings in ₦1.2 million annually—about £1,000 a year. After agency fees, maintenance, and the months when your tenant "forgot" to pay rent, you're netting maybe £700.

Then your cousin calls you from Lagos: "Bro, my Airbnb in Lekki made ₦400,000 last month alone. That's almost ₦5 million a year. Why are you still doing annual rent?"

Welcome to the short-let revolution that's sweeping Nigeria's real estate market. And if you're a diaspora investor watching from London, New York, or Toronto, you're probably wondering: Is this real? Or is this another Nigerian real estate hype that'll crash and burn?

Let me break it down for you. No hype. Just numbers, risks, and real talk.

What Exactly Is a Short-Let Apartment?

Let's start with basics.

A short-let (also called short-term rental or serviced apartment) is a fully furnished property rented out for short periods—typically 1 day to 3 months.

Think Airbnb, but in the Nigerian context.

Instead of renting to one tenant for a year at ₦1.5 million, you're renting to multiple guests throughout the year:

• Corporate traveler for 5 days
• Couple celebrating anniversary for a weekend
• Family visiting for a wedding for 2 weeks
• Expat waiting for their permanent accommodation for a month

Each stay is charged per night. And the math gets very interesting very quickly.

The Numbers: Why Everyone Is Talking About Short-Lets

Let me show you why your cousin is so excited. Here's a real comparison based on 2025 Lagos market data.

Traditional Annual Rental (2-bedroom in Lekki Phase 1)

• Annual rent: ₦2,000,000 (about £1,700)
• Agency fee (10%): -₦200,000
• Maintenance/repairs: -₦150,000
• Vacancy (if any): potentially 1-2 months lost income
• Net annual income: ₦1,650,000 (£1,375)

You sign one tenant, collect rent once a year (if you're lucky), and hope they don't destroy your property or refuse to move out.

Short-Let (Same 2-bedroom in Lekki Phase 1)

• Average nightly rate: ₦35,000 - ₦50,000
• Conservative occupancy: 18 nights per month (60%)
• Monthly income: 18 × ₦40,000 = ₦720,000
• Annual income: ₦720,000 × 12 = ₦8,640,000 (£7,200)
• Management fees (20-30%): -₦2,160,000
• Utilities (electricity, water, internet): -₦1,200,000
• Cleaning, toiletries, maintenance: -₦800,000
• Marketing & platform fees: -₦300,000
• Net annual income: ₦4,180,000 (£3,483)

That's 2.5× higher than traditional rental income. Same property. Different model.

And that's conservative. Some well-managed short-lets in prime areas achieve 75-80% occupancy and generate ₦6-10 million annually.

Now you understand the excitement.

Why Short-Lets Are Booming in Nigeria Right Now

This isn't a random trend. There are structural reasons why short-lets exploded in Nigeria over the past 3-4 years:

1. Hotel Prices Are Ridiculous

A decent hotel in Lagos (Victoria Island, Lekki, Ikeja GRA) costs ₦40,000-₦150,000 per night. For that price, you get a small room, overpriced breakfast, and attitude from the front desk.

A short-let apartment gives you:

• Full kitchen to cook your own meals
• Living room and bedroom(s) for space
• More privacy and flexibility
• Often cheaper (₦25,000-₦60,000/night)

Travelers—especially families and business people staying more than 2-3 nights—prefer short-lets. Better value, more comfort.

2. Rise of the "Returnee" Class

More Nigerians are relocating back from abroad or traveling frequently between Nigeria and diaspora. They don't want annual leases. They want flexibility.

They'll rent a short-let for 2 weeks when visiting family, or 1 month while they house-hunt, or 3 months while setting up their business.

3. Corporate Demand Is Massive

Nigerian and international companies are sending employees to Lagos constantly:

• Oil and gas workers rotating in from offshore
• Consultants on short-term projects
• Expats waiting for company housing
• Training programs and conferences

These corporate clients pay premium rates and book for weeks or months at a time. They're your most profitable customers.

4. Events and Tourism

Nigeria has a growing events culture:

• Weddings (nearly every weekend in Lagos)
• Detty December (diaspora coming home for Christmas)
• Concerts and festivals
• Business conferences

During peak seasons (December, August, wedding season), short-let rates double or triple. You can charge ₦80,000/night for an apartment that normally goes for ₦35,000.

5. Technology Made It Easier

Platforms like Airbnb, Booking.com, Shortlet.ng, and Nigeria Property Centre have made it simple for property owners to list and manage bookings.

You're in Toronto. Your property manager in Lagos handles check-ins, cleaning, and maintenance. You monitor bookings on your phone. Money hits your account automatically.

Technology eliminated the biggest barrier: needing to be physically present.

The Dark Side: Risks Diaspora Investors Must Know

Okay, I've shown you the money. Now let me show you the landmines.

Because yes, short-lets can make serious income. But they can also blow up in your face if you don't know what you're doing.

Risk 1: Regulatory Uncertainty

Here's the big one: Nigeria's short-let regulation is still evolving and varies by state.

Lagos State introduced short-let licensing requirements in 2023-2024. You now need:

• Lagos State Short-Let License
• Environmental health certification
• Fire safety certification
• Tax registration with LIRS
• Proof of property ownership

Penalties for operating without proper licenses include:

• Fines of ₦500,000+
• Property sealing
• Legal action

Other states are following Lagos's lead. The regulatory landscape is tightening.

What this means for you: You can't just throw furniture in an apartment and start listing on Airbnb. You need to go legal and get proper licensing.

Budget ₦200,000-₦500,000 for initial registration, certifications, and legal compliance.

Risk 2: Management Intensity

Traditional rental: Sign lease, collect rent once a year, fix issues occasionally. Low effort.

Short-let: Constant bookings, guest communication, cleaning after each stay, restocking supplies, handling complaints, coordinating repairs, marketing, managing reviews.

This is a business, not passive income.

If you're in London and think you can manage this yourself, you're dreaming. You need:

• A dedicated property manager or management company
• 24/7 availability for guest emergencies
• Professional cleaners on standby
• Maintenance team for quick fixes
• Systems for inventory management (toiletries, linens, kitchen supplies)

Management companies typically charge 20-30% of revenue. That's ₦1.7-2.6 million annually on an ₦8.6 million gross income.

And bad management will kill your short-let business faster than anything else. One bad review about dirty sheets or no electricity destroys your reputation.

Risk 3: Occupancy Isn't Guaranteed

My earlier example assumed 60% occupancy (18 nights per month). That's realistic for a well-managed property in a good location.

But here's what can tank your occupancy:

• Bad location (too far from airports, business districts, attractions)
• Poor photos and listing description
• Negative reviews
• Competition (the market is getting crowded)
• Seasonality (January-March are slow, December is booming)
• Economic downturn (when budgets tighten, short-let bookings drop)

If you only hit 40% occupancy (12 nights/month), your annual income drops to ₦5.76 million. After expenses, you're netting ₦2.4 million—which is better than traditional rent, but not the 150% premium you were promised.

Risk 4: Property Damage and Theft

Annual tenants generally take care of the property (or at least you know who to hold accountable if they don't).

Short-let guests? You're hosting strangers constantly. And some of them will:

• Stain your furniture
• Break appliances
• Steal towels, cutlery, electronics
• Throw unauthorized parties
• Damage walls or fixtures
• Cause plumbing issues

Most damage is minor and covered by security deposits or cleaning fees. But occasionally you'll get a nightmare guest who causes ₦200,000-₦500,000 in damage.

Insurance helps but doesn't cover everything. Budget ₦500,000-₦1 million annually for repairs, replacements, and refresh renovations.

Risk 5: Inconsistent Electricity and Infrastructure

This is Nigeria-specific. Your guests expect 24/7 electricity, hot water, fast internet, and constant water supply.

If NEPA takes light and your generator fails, you'll get 1-star reviews and refund demands.

You need:

• Reliable generator or inverter system (₦500,000-₦2 million)
• Diesel/fuel budget (₦50,000-₦150,000/month depending on power situation)
• Backup water storage (borehole or large tanks)
• Fast internet (minimum 20 Mbps, ideally fiber)
• Water heater for hot showers

Infrastructure costs are higher for short-lets than traditional rentals because guests expect hotel-level reliability.

Risk 6: Competition Is Increasing Rapidly

Three years ago, short-lets were a blue ocean. Today, everyone and their uncle is converting properties to short-lets.

In areas like Lekki Phase 1, Ikate, Oniru, and VI, you're competing with hundreds of other listings. Some owned by professional hospitality companies with deeper pockets and better systems.

This drives down prices and makes it harder to maintain high occupancy.

The days of throwing any apartment on Airbnb and watching bookings flood in are over. You need to be competitive:

• Better photos
• Better pricing strategy
• Unique amenities (gym access, rooftop terrace, pool)
• Exceptional guest experience
• Strong reviews

Who Should Buy Short-Let Properties?

Short-lets aren't for everyone. Here's who they work for:

You Should Consider Short-Lets If:

You want active income, not passive income You're willing to treat this as a business, not a "set it and forget it" investment.

You can afford professional management You have budget for a 20-30% management fee or can hire a dedicated property manager.

You're buying in prime locations Lekki, Victoria Island, Ikoyi, Ikeja GRA, parts of Ajah. Locations matter 10× more for short-lets than traditional rentals.

You can handle regulatory compliance You're willing to get proper licenses, pay taxes, and operate legally.

You have capital for furnishing and infrastructure Furnishing a 2-bedroom short-let to competitive standards costs ₦3-7 million. Plus generator, inverter, water systems, etc.

You're financially stable enough to weather low seasons You won't panic if January-March bookings are slow and you need to subsidize expenses from other income.

Skip Short-Lets If:

You want truly passive income If you don't want to deal with ongoing management, stick to traditional rentals or REITs.

You're buying in remote or non-commercial areas Short-lets don't work in residential areas far from business districts, airports, or entertainment. Guests need convenience.

You can't afford good property management Bad management = bad reviews = dead business. If you're trying to cut costs by self-managing from abroad, you'll fail.

You're risk-averse Short-let income fluctuates monthly. Some months you'll make ₦900,000, some months ₦400,000. If you need predictable income, this will stress you out.

You can't handle Nigerian infrastructure challenges If the idea of managing generator fuel costs and NEPA wahala from overseas gives you anxiety, stick to traditional rent.

How to Succeed with Short-Let as a Diaspora Investor

Alright, you've decided short-lets are for you. Here's how to actually make it work:

1. Buy in the Right Location

Location determines 70% of your success. The best short-let areas in Lagos:

Tier 1 (Highest Demand, Premium Pricing):

• Lekki Phase 1
• Victoria Island (VI)
• Ikoyi
• Banana Island

Tier 2 (Strong Demand, Good Pricing):

• Ikate Elegushi
• Oniru
• Chevron Drive
• Ikeja GRA
• Maryland

Tier 3 (Growing Demand, Moderate Pricing):

• Ajah
• Abraham Adesanya
• Sangotedo
• Ikota

Avoid: Deep residential areas, Mainland locations far from business districts (unless you're targeting a very specific niche).

2. Furnish to a High Standard

Your furniture and finishing need to compete with photos online. Budget:

• Basic/Economy Furnishing: ₦2-3 million (IKEA-level, functional but basic)
• Mid-Range Furnishing: ₦4-6 million (comfortable, stylish, Instagram-worthy)
• Luxury Furnishing: ₦8-15 million (high-end appliances, designer furniture, premium finishes)

Don't skimp on:

• Comfortable mattresses (guests will complain if they sleep badly)
• Air conditioning in all rooms (this is Lagos)
• Fast WiFi (business travelers need it)
• Quality kitchen appliances
• Nice bathrooms (shower pressure, hot water, clean tiles)
• Good photography lighting

3. Hire a Professional Property Management Company

Interview at least 3 companies. Ask:

• What percentage do they charge? (20-30% is standard)
• How do they handle guest communication and emergencies?
• Do they provide cleaning staff or contract out?
• How do they handle maintenance issues?
• What booking platforms do they list on?
• Can you see their other properties and reviews?
• How do they handle payments and send you monthly reports?

Get references. Talk to other diaspora investors using their services.

Good management companies include:

• (Research current top-rated companies—market changes rapidly)

4. Invest in Professional Photography

Your listing photos are your storefront. Bad photos = no bookings.

Hire a professional real estate photographer (₦50,000-₦150,000 for a shoot). They'll use:

• Wide-angle lenses to make rooms look spacious
• Proper lighting to make spaces look warm and inviting
• Staging to showcase the property's potential

Amateur phone photos won't cut it. This is a business. Invest in presentation.

5. Price Strategically

Don't just copy your neighbor's pricing. Use dynamic pricing:

• Lower rates during low season (Jan-March) to maintain occupancy
• Premium rates during high season (December, August)
• Weekend vs weekday pricing
• Discounts for longer stays (7+ nights, 30+ nights)

Tools like PriceLabs or Beyond Pricing can automate this if your management company doesn't already handle it.

6. Become Obsessed with Reviews

Your star rating and reviews determine whether guests book or skip your listing.

• Respond to every review (thank good ones, address criticism in bad ones professionally)
• Over-deliver on guest experience (small touches like welcome snacks, local recommendations)
• Fix any issues mentioned in reviews immediately
• Aim for 4.8+ stars on all platforms

One nightmare guest can leave a 1-star review that tanks your bookings for months. Handle guest issues proactively before they escalate to reviews.

7. Operate 100% Legally

Get all required licenses and certifications:

• Lagos State Short-Let License (or equivalent in your state)
• Fire safety certificate
• Environmental health certification
• Tax registration with state revenue service
• Business registration (if operating as a company)

Yes, it's bureaucratic and costs money. But operating illegally puts your entire investment at risk. One government raid can shut you down and cost you ₦500,000 in fines.

8. Use Multiple Booking Platforms

Don't rely on just Airbnb. List on:

• Airbnb (international guests, diaspora)
• Booking.com (corporate travelers)
• Shortlet.ng (local market)
• Nigeria Property Centre (local market)
• Your own Instagram/website (direct bookings = no commission fees)

Diversification protects you if one platform changes their algorithm or policies.

The Numbers Revisited: Realistic 5-Year Projection

Let's run a real 5-year scenario. You buy a 2-bedroom in Lekki Phase 1 to operate as a short-let.

Initial Investment:

• Property purchase: ₦45 million (£37,500)
• Furnishing & setup: ₦5 million (£4,167)
• Licenses & legal: ₦500,000 (£417)
• Total: ₦50.5 million (£42,084)

Annual Income (Conservative 60% Occupancy):

• Gross rental income: ₦8.6 million
• Less management (25%): -₦2.15 million
• Less utilities & operations: -₦1.5 million
• Less maintenance & repairs: -₦800,000
• Net annual income: ₦4.15 million (£3,458)

5-Year Return:

• Total net income: ₦20.75 million (£17,290)
• Property appreciation (conservative 5%/year): ₦11.5 million (£9,583)
• Total 5-year gain: ₦32.25 million (£26,873)
• ROI: 64% over 5 years (~10.2% annually)

Compare this to traditional rental:

• Net annual income: ₦1.65 million (£1,375)
• 5-year total: ₦8.25 million (£6,875)
• Plus appreciation: ₦11.5 million
• Total: ₦19.75 million (£16,458)
• ROI: 39% over 5 years (~6.8% annually)

The short-let generates ₦12.5 million (£10,415) more profit over 5 years. That's 63% higher returns.

But it requires more work, more risk, more management.

Alternatives to Full Short-Let: Hybrid Models

If you're intrigued but nervous about full short-let commitment, consider hybrid models:

Hybrid Model 1: Medium-Term Rentals

Rent your furnished apartment for 1-3 months at a time to corporate clients or relocating professionals.

Pros:

• More stable than nightly short-lets (fewer turnovers)
• Less management intensive
• Still 40-60% higher income than annual rent
• Fewer regulatory headaches

Cons:

• Lower income than full short-let
• Still needs furnishing and management

Hybrid Model 2: Annual Tenant + Short-Let During Vacancy

Rent annually to a long-term tenant, but when they leave, use the 1-2 month vacancy period to run it as a short-let.

Pros:

• Stable base income from annual rent
• Test short-let concept with minimal risk
• Cover costs during vacancy periods

Cons:

• Requires furnished apartment (higher upfront cost)
• Tenant might not take care of furniture as well

Hybrid Model 3: Partner with Corporate Housing Companies

Some companies lease furnished apartments long-term to house rotating employees.

They'll pay 30-50% above market rent for a fully furnished, well-maintained property with reliable infrastructure.

Pros:

• Higher than traditional rent, lower than short-let
• Corporate entity as tenant (more reliable payment)
• Less day-to-day management

Cons:

• Lower ceiling than successful short-let
• Requires negotiation with companies

Final Verdict: Should You Do It?

Here's my honest take:

Short-lets in Lagos can absolutely generate 100-150% higher returns than traditional rentals. The numbers are real. The demand is real.

But this is active real estate business, not passive investment.

If you're willing to:

• Invest in prime locations
• Furnish to high standards
• Hire professional management
• Operate legally
• Handle fluctuating income
• Treat it as a business

Then yes, short-lets can be phenomenal for building wealth from abroad.

But if you want to buy property, collect rent once a year, and forget about it, stick to traditional rentals or consider Nigerian REITs instead.

Know yourself. Know your risk tolerance. Know your time and attention capacity.

The opportunity is real. But so are the challenges.

Your Next Steps

If you're seriously considering short-let investment:

This week:

1. Research short-let regulations in your target state (Lagos, Abuja, etc.)
2. Calculate your budget (purchase + furnishing + licensing + 6 months operating reserve)
3. Join Nigerian short-let investor groups on Facebook/WhatsApp

This month: 4. Interview 3 property management companies 5. Study short-let listings in your target area (pricing, amenities, reviews) 6. Talk to other diaspora investors running short-lets

Within 3 months: 7. Identify specific properties in prime short-let locations 8. Run detailed financial projections (be conservative on occupancy) 9. Make your decision: full short-let, hybrid model, or traditional rental

Want help identifying short-let-ready properties or connecting with trusted property managers? Book a free consultation to discuss your investment goals.

The Lagos short-let market is evolving fast. Those who enter with eyes wide open, proper planning, and professional execution will build serious wealth.

Those who jump in blindly chasing hype will get burned.

Which one will you be?

Are you running a short-let from abroad? What's been your experience? Share your story in the comments or join our diaspora investor community.

Sources:

• Nigeria Real Estate 2025: Diaspora Investment & Market Trends
• How diaspora investments are reshaping real estate market
• 8 Real Estate Investment Options for Nigerians in Diaspora