29/05/2026
Why and How Banks Sell Houses in Nigeria:
Banks primarily sell foreclosed or repossessed properties. When borrowers default on loans (especially mortgages or large facilities secured by real estate), banks exercise their power of sale under Nigerian law. This often happens through:
- Public auctions** (common method)
- Private treaty** (direct sales)
- NDIC auctions** for assets of failed/closed banks
This practice became more prominent in certain periods, such as:
- After the 2008-2009 global financial crisis and subsequent bank consolidations/reforms in Nigeria.
- During economic recessions (e.g., 2016 and around 2020), when non-performing loans (NPLs) rose sharply. Banks like GTBank, Zenith, and others offloaded repossessed properties to clean up balance sheets.
- Ongoing basis: Banks regularly auction chronic debtors' properties (houses, hotels, filling stations, etc.).
Examples:
- NDIC (Nigeria Deposit Insurance Corporation) regularly advertises public auctions and competitive bids for landed properties and buildings of defunct banks.
- Commercial banks list and sell bank-owned (REO-like) properties.
- Distressed property auctions are a standard recovery tool.
These sales are often at discounted prices compared to market value, making them attractive to investors, but they come with risks (e.g., title issues, eviction challenges, or legal disputes).
