The real estate market is experiencing a shift in paradigm as more developers and property subscribers move to remote areas in search of cheaper accommodation space in suburbs and partly developed areas.
With the increasing spate of rent default by tenants across the country, especially, in the urban centres, most tenants are now seeking cheaper accommodation that will enable them revive their livelihoods and rent payment obligations.
With the spike in inflationary trends and low purchasing power of households, the related shocks become more worrisome in many households groaning with the spike in economic inflations, unemployment and poor economic sustainability plan of the government which is pushing many Nigerians to relapse into poverty with debt overhang.
To this end, real estate experts have decried the growing trends of multiple court cases as more tenants continue to face legal evictions procedures from the courts due to rent default and inability to meet the payment deadline of their rent.
Hence, experts cautioned against further increments of house rents, stating that, more tenants have continued to move to suburbs in search of cheaper accommodations that will meet their current financial standards and income level.
Addressing the issue, Group MD, ATCO HOMES, Mr. Bartholomew Egbochie, said homebuilders decried over the high cost of building materials, turnkey projects, renovation cost, high maintenance cost while adding that government should implement a price cushioning framework that will make rent affordable for commercial and private home builders in the country.
Hence, the experts cautioned against further increments in house rents, stating that, more tenants have continued to move to suburbs in search of cheaper accommodations that meet their current financial standard.
Similarly, managing director of Terrific Outfits and Celebrity City Limited, Osokoya Adewale, has called on both federal and state governments to partner with the organised private sector players, real estate developers and financial institutions, to drive growth and provide good and affordable housing infrastructure for the good and safety of Nigerians.
Osokoya, said government alone cannot meet the housing needs of the people, positing that government must partner with the private sector to solve the problems of housing deficits in the country.
He stated that reports from the United Nation’s statistics indicated that the housing deficits in Nigeria is estimated at 22 million homes of unit shortfall.
While describing this figure as alarming, she noted that in the next ten years, the number of Nigerians with no homes would have doubled if care was not taken.
He therefore called on government at all levels to make land and finances available for real estate developers.
He said: “government must provide the enabling environment for businesses to thrive. Government must formulate policies that will encourage the private sector to come into the real estate sector, provide affordable housing for the people.”
Speaking, one of the Landlord named Mr. Abiodun Oresanya, a owner of a block of four rental apartments in Ojodu Area of Lagos, said; nearly everything has increased in price, from foodstuffs to building materials. “For a landlord like me who lives off rents payment as my life pension by my tenants, I have no choice but to transfer this high cost to them, else, the survival and maintenance of my properties may be threatened and my livelihood will become deplorable,” he noted.
Reacting to increase in house rent, a tenant and spare part dealer in Lagos, Emeka Ejiofor, accused the landlords of being shylocks by taking advantage of a bad economic situation and a largely unregulated sector to fleece tenants of their hard earned resources.
Ejiofor lamented that tenants in Lagos don’t have savings, they work to eat and pay rent and this is so devastating while urging private sector and government to come to the rescue of the tenants and property subscribers in the country who are bearing the burdens of the high maintenance cost and hike in rent.
Another tenant, Olusola Asogbon said, “my landlord, who wanted to increase rent, met with strong resistance from the tenants. Rather than communicating with us at the beginning of the year, he decided to inform us 8 months into the year, so we rejected his plan,”
Speaking on the issue, Dr. Abiodun Bewaji, of Abiodun Bewaji Consulting firm, confirmed the wild rent hikes warning that the trend could continue as the year winds down.
He said: “one of tthe fallouts of the Covid-19 pandemic is our inability to get tenants to pay up their outstanding rents. Many realtors are currently dealing with multiple cases of rent defaults, particularly among the lower- and middle-income earners. Conclusively, rent default is more pronounced for residential properties than for commercial properties.”
Bartholomew Egbochie hinted that government needs to step up plans to incentivize the real estate sector with social housing scheme and low housing intervention support to enable citizens have a good and meaningful lives.
This, he said, through the sectoral intervention programmes would help players build more affordable housing units for Nigerians. Considering the growing socioeconomic challenges such as price inflation and displacement that is currently ravaging many households in the nation, he said, the real estate sector needs to be proposed for incentivizing tactical approach while believing that, with this measure, Nigerians should be able to have at least a decent housing unit in a decent city.w