The Land Use Act of 1978: How Land Ownership Really Works in Nigeria

What the Land Use Act actually did

The Land Use Act of 1978 is the single most important law for anyone buying property in Nigeria, and most buyers have never read it. It did one radical thing: it took land out of private freehold ownership and vested it in the state. Section 1 places all land in the territory of each state in the Governor, to be held in trust and administered for the use and common benefit of all Nigerians. From that moment, no individual has owned land outright in Nigeria. What you can hold is a right to occupy and use it.

Understanding why that is true, and what it means for your money, is the difference between buying confidently and buying blind.

How land is controlled

The Act splits land into two categories and two granting authorities. Under Section 5, the Governor grants statutory rights of occupancy over urban land. Under Section 6, local governments grant customary rights of occupancy over land that is not in an urban area. The Governor's office controls and administers all land within the state, which is why so many transactions route back to the state Lands Bureau or, in the Federal Capital Territory, to the FCT administration through AGIS.

This centralisation is the source of both the system's protections and its frustrations. It is why title can be verified at a single registry, and also why nearly every transfer needs a government step to be complete.

The right of occupancy and the 99-year term

A right of occupancy is the core interest the Act creates. It is a leasehold-style right, granted for a term that does not exceed 99 years. Section 9 allows the Governor to issue a Certificate of Occupancy as evidence of that right. The certificate is proof, not the source, of the interest. This distinction matters because buyers often assume a C of O is a freehold deed. It is not. It is documentary evidence of a time-limited right granted by the state.

Section 22 and why consent runs through everything

Section 22 is the provision that shapes every resale in the country. It makes it unlawful for the holder of a statutory right of occupancy to alienate that right, by assignment, mortgage, transfer of possession, sublease, or otherwise, without the Governor's consent first obtained. Section 26 reinforces this by making any transaction that breaches the consent requirement null and void.

Read those two sections together and the consequence is clear. A sale of titled land is not legally effective until the Governor consents to it, and a transaction done without consent is void, not merely irregular. This is not a bureaucratic afterthought. It is the law deciding whether your purchase is real.

Revocation and compensation

The Act also lets the state take land back. Section 28 allows the Governor to revoke a right of occupancy for overriding public interest, such as for public works or where the holder breaches the terms of the grant. Section 29 provides for compensation, but compensation under the Act has historically been calculated on the value of improvements and unexhausted development rather than open-market value, which is why revocation is a genuine risk to price into long-horizon investments, particularly land in the path of infrastructure.

Ground rent and the obligations that come with the grant

A right of occupancy is not free of ongoing duty. Holders owe ground rent and are subject to the conditions attached to the grant. Failure to meet these obligations, including non-payment of statutory charges, can expose the holder to revocation. For an absentee or diaspora owner, lapsed ground rent and unpaid land charges are a quiet but real way to weaken your position, so they belong on your annual checklist.

What the Act means for foreigners

The Act does not single out foreigners with a separate ownership ban. Instead, the abolition of freehold applies to everyone, and the consent regime applies to everyone. Foreigners hold the same statutory rights of occupancy that Nigerians do, for terms up to 99 years, and Governor's Consent is mandatory on transfers to them. Many foreign investors use a Nigerian-incorporated company to hold property, which is permitted, but the company still operates inside the same Land Use Act framework.

The practical takeaways

Three things follow directly from the Act and should govern how you buy. First, treat every title as a time-limited right granted by the state, verify it at the registry, and never assume a certificate equals ownership. Second, never close a purchase of titled land without Governor's Consent on your own transaction, because Sections 22 and 26 can render an unconsented deal void. Third, keep ground rent and statutory charges current, because the same Act that grants your right also lets the state revoke it.

The Act governs the land. It says nothing about whether a developer will finish the estate you are buying into. That is a separate due-diligence question, and checking a developer's delivery history on a platform like Bektu is how you cover the gap the law leaves open.