The latest Household Expectations Survey from the Central Bank of Nigeria (CBN) has revealed that Nigerians are increasingly postponing major purchases such as cars, homes and household appliances due to high living costs and elevated borrowing rates.
The survey showed that buying conditions for vehicles, consumer durables and buildings and landed property remained well below 30 points, indicating that consumers generally considered the period unfavourable for such major purchases.
The findings suggest that despite recent moderation in inflation, households remain focused on essential spending, with limited disposable income available for discretionary purchases and long-term investments.
According to the CBN, the Consumer Sentiment Index for average prices of selected items declined to 24.3 points in July from 28.9 points in June, indicating a modest easing in consumers’ perception of price pressures.
Buying conditions stood at 28.7 points for motor vehicles, 28.9 points for consumer durables and 30.0 points for buildings and landed property.
Willingness to purchase was even weaker, with motor vehicles at 18.7 points, buildings and landed property at 19.2 points and consumer durables at 24.4 points.
House purchases recorded an outlook index of -56.9, while cars and motor vehicles stood at -56.3.
Household appliances and other durable goods recorded -36.8, while investment intentions stood at -35.7 and rent at -24.6.
The CBN noted that expectations across most spending categories could improve modestly over the next six months, although current consumer sentiment remains subdued.
“The Buying Conditions Index for major purchases remained below the 50.0 threshold throughout the review period, indicating that a majority of respondents considered the prevailing environment unfavorable for purchases of consumer durables, vehicles, and buildings or landed properties,” the report read in part.
The survey also showed that consumers remain concerned about inflation and borrowing costs. Consumer Outlook Index readings for expected price changes stood at 23.3 points over the next three months and 25.0 points over the next six months.
According to the survey, 63.4 per cent of households said the Nigerian economy would deteriorate if inflation accelerated beyond its current pace, 35.6 per cent of respondents expected bank lending rates to increase over the next three months, while 57.2 per cent preferred interest rates to decline.
Meanwhile, 46.5 per cent of the respondents acknowledged the need for higher interest rates to help contain inflation.
Food remained the biggest spending priority for households, with other major expenditure areas including household goods, education, transportation, electricity and water.
This spending pattern confirms that consumers continue to prioritise spending on necessities over discretionary purchases. Higher benchmark rates have contributed to elevated borrowing costs for households and businesses, making mortgages, vehicle financing and consumer loans more expensive.
The combination of high borrowing costs and lingering concerns about prices has continued to weigh on household purchasing decisions.
