Crippling Lagos rents: A growing concern

Supreme Desk
11 March 2024 8:55 AM GMT
Crippling Lagos rents: A growing concern
For many people, finding a decent and affordable place to live in Lagos has become a battle.

Lagos, the smallest but highly populous state and Nigeria’s commercial nerve centre, is undoubtedly full of activities and excitement.

Founded in 1967 with headquarters in Ikeja, Lagos boasts some facilities and infrastructure that make business efforts rewarding and life generally interesting.

However, beneath these lies a growing concern—a housing challenge with crippling rents.

With a land area estimated at 3,577 square kilometres and population estimates of 9,113,605 (2006 census), 12,772,884 (National Bureau of Statistics in 2019), and 35,000,000 (Lagos State Government in 2020), Lagos State continues to have housing deficits in spite of the estimated 300,000 new housing units constructed annually in the state.

For many people, finding a decent and affordable place to live in Lagos has become a battle.

The accommodation problem in the commercial nerve centre has become worrisome.

A two-bedroom apartment in Festac Town, for instance, attracts an annual rent of about N900,000.

A similar apartment in a suburb, such as Egbeda, goes for an annual rent of N550,000.

A room (self-contained) in Ajah attracts an annual rent of about N800,000.

While some landlords accept monthly rents, many insist on annual rents.

Ms. Aisha Haruna, a single parent and mother of two who sells periwinkle at the Makoko Seafood Market in Yaba, says thinking of her rent is a nightmare.

Haruna, who lives with her children in a one-bedroom apartment at Bariga, a Lagos suburb, says that her N6,000 monthly rent is burdensome and makes her sacrifice other important needs.

She also says the accommodation is not decent, but she has to stick to it due to her poor income.

“It is a constant struggle. I want to provide a safe and secure home for my children, but Lagos is making it increasingly difficult,” she says.

According to the single parent, she has to choose between paying the rent and having money to feed her household.

Mr. John Madu, a fresh graduate with a dream of starting a career in music, also goes through a similar struggle.

Madu is compelled to share a room with three others in Igando, also a Lagos suburb, due to the high rent in Lagos State.

The monthly rent of the room is N12,000, according to Madu.

He says the type of accommodation makes him uncomfortable and hinders him from focusing on starting a career in music.

“I feel like I’m constantly on edge; I yearn for a space of my own, but with high rents, it feels like a distant dream.

Analysts are worried about the high rent in Lagos State and its negative effects on people’s mental and physical well-being.

“It has caused many tenants to experience anxiety, depression, and sleep disturbances. It is a burden,” says a Festac resident, Mrs. Catherine Chima.

Chima is convinced that many families in Lagos have sacrificed essential needs—good food, healthcare, and education—for accommodation due to high rent.

She observes that many Lagos residents are living in crowded, insecure, and dirty places where they could afford the rent.

She yearns for more affordable housing options from governments.

In an effort to tackle accommodation problems, the Lagos State Government has initiated a homeownership scheme that allows a resident to buy a house over time by paying rent with the option to eventually own it.

The scheme was initiated in 2013 by the Babatunde Fashola administration.

The scheme (rent-to-own) requires a five percent upfront payment with a six percent simple interest rate on the balance to be spread over 10 years.

The scheme, many believe, has not done much to tackle the housing challenge in the commercial nerve centre.

Again, the state government recently announced that it was working on a monthly rental scheme in which rents would be charged according to tenants’ earnings.

Mrs. Barakat Odunuga-Bakare, Special Adviser to Lagos State Governor Babajide Sanwo-Olu on Housing, announced the scheme recently at a news conference in Lagos.

She is confident that the scheme will be implemented before the end of 2024 or early 2025.

The official believes that the scheme will be affordable to low- and middle-income earners.

Also, in a bid to reduce accommodation problems, Fashola, the then Minister of Works and Housing, proposed in February a review of tenancy laws in states to compel landlords to collect rents monthly.

Some stakeholders in housing believe that the yearly rental system has created inequality in housing supply and widened the affordability gap.

A construction expert, Mr. Kunle Awobodu, urges the Federal Government to revive the Ajaokuta Steel Factory in order to lower the cost of building materials and make accommodation cheaper.

He believes that manufacturing steel in Nigeria, instead of importing it, will slash costs for builders and make houses and other building projects more affordable.

He notes that in the last 12 months, prices of essential building materials such as paints, roofing sheets, glass, cement, blocks, doors, reinforcement rods, sand, timber, and tiles have risen by over 90 percent.

“This has become a source of concern to building professionals because of the direct impact on supply, affordability, and accessibility to housing, especially for low and middle-income earners,” he says.

Mr. Adesegun Banjoko, National President, National Association of Block Moulders of Nigeria, urges the Federal Government to establish a commodity price regulation board to address rising prices of building materials.

He is convinced that the establishment of the board will also prevent unfair practices and make it easier for many Nigerians to own homes.

He urges governments to encourage both local production and responsible importation to lower prices.

Mrs. Adenike Ayanda, the National General Secretary of the Building Collapse Prevention Guild, urges the federal governments to control inflation, stabilise the naira, and reduce living costs.

She says, “Inflation is a major challenge for the construction industry in Nigeria.

“It increases costs, encourages risky practices, and threatens the safety of buildings and workers.

“The government should explore mechanisms such as rent stabilisation measures to temporarily control rent increases,” she suggests.

Mr. Muyiwa Segun, a landlord and retired Lagos State civil servant at Igando, urges the Lagos State Government to support and empower potential homeowners with finance to build their own homes.

“I will suggest two solutions to address the challenge of affordable housing in Lagos.

“Lagos State Government should offer financial assistance to low-income earners and first-time homebuyers in the form of mortgage subsidies and loan guarantees.

“The mortgage subsidies mean the government will contribute some portions of the mortgage interest, making the monthly payments more affordable for eligible individuals.

“The loan guarantee provides a guarantee to the lender that the loan will be repaid, even if the borrower defaults.

“This can encourage lenders to offer mortgages to individuals who might otherwise be considered high-risk due to their income level,’’ he urges.

Analysts urge intensified efforts to reduce the burden of rent in Lagos State.

Supreme Desk

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