The paper examines willingness to pay (WTP) at the level of household in Ilorin,
Nigeria. Ilorin was divided into four residential zones namely: Government Reservation Area
(GRA), Modern Area, Housing Estates, and Traditional Area. 50 questionnaires were
administered in each of these zones; making a total of 200 questionnaires administered in the
whole of the study area. Also, 37 socio-economic variables were generated from the
questionnaire. Due to multicolinearity problem, factor analysis method was used to reduce the 37
variables to orthogonal factor defining variables. Multiple regression analysis was used to
associate willingness to pay (WTP) and the social economic variables. The result of factor
analysis showed that 3 factor defining variables (fdvs): income, demography and educational
level, are the most dominant factors having 98% explanation. Further analysis through stepwise
multiple regression suggests that household income is the best predictor of WTP in Ilorin with
83% explanation. The paper posits that any policy towards pricing water in Ilorin should consider
household income as an important variant