Minister of Power, Works and Housing, Babatunde Fashola, recently proposed a new house rental model under which tenants would pay their rents monthly in arrears, and not annually in advance, to ease the housing pains of Nigerians. Hinging his proposal on the practice in some developed countries where rents are paid either weekly by those who earn weekly salaries, or monthly by those who are paid every month, he directed Nigerian landlords to stop the practice of collecting two years rent in advance, as this amounts to making tenants pay money that they are yet to earn. He also suggested the practice of linking tenants’ offices with their landlords, so that the tenants’ salaries can be deducted at source and paid to their landlords.
The minister’s proposal is a welcome intervention on the nation’s housing crisis. There is no doubt that housing has become a critical problem in the country, with many residents unable to secure accommodation on account of the landlords’ demands for one or more years of advance rent. Fashola’s proposal that tenants pay their rents monthly will certainly make life easier for tenants, but there are at least two reasons why the minister’s idea is unlikely to be well received in the country.
First, is that the suggestion is an effort to solve a problem by dealing with its effects, rather than its cause. The main problem, in this instance, is the serious housing shortage put at about 17 million in the country. It is this gross housing deficit that has made it possible for landlords to demand huge sums in advance as rents. As long as the housing deficit persists, Nigeria is sure to be a landlord’s market.
That is why so many rent policies designed to address the problem, such as the one which made it illegal for landlords to collect more than a year’s rent in advance, have failed to address this problem. This is because a man who needs accommodation for his family is likely to remain homeless as he chases a landlord in the courts for demanding two years’ rent, while those who are more than ready to take up the accommodation on whatever terms, do so.
It is, therefore, clear that the solution to the housing problem, especially in commercial cities like Lagos and Abuja where the payment of annual rents is prevalent, will be better addressed with a significant increase in the housing stock. This will make housing a tenant’s market in the country.
The Federal Government, in the early days of the current administration, announced an ambitions housing programme under which many houses were to be built in every state in the country. Many stakeholders lauded this plan at the time but it is doubtful if any massive federal housing estates have been built in many states. What this means that is that the Federal Government’s programme for the new housing is yet to be fully executed. There has also been no significant federal private/public sector initiative to bring the promised new houses to reality. It would appear, therefore, that the way to go would be for the Federal Government to come up with a major initiative that would involve the private sector to boost housing supply in the country. This will definitely be a better alternative to directing landlords on how to collect rents on their personal houses. This is more so as landlords also pay for other services, such as their children’s school fees, in advance and not in arrears.
The other major problem with Fashola’s idea rests on the character of many Nigerians. There is no gainsaying the fact that any landlord who chooses to collect his rents monthly will need to tighten his belt for a monthly battle with his tenants to collect the rents.
This is not an attempt to paint Nigerian tenants in bad light. It is simple reality that the existentialities of daily living, poor prioritisation, nonchalance, stubbornness, abject poverty etc of many tenants will make it difficult for them to regularly pay their rents at the end of every month. Some may even simply abscond without paying their rent at month’s end, and our courts, and rent laws, are glaringly more friendly to tenants than landlords.
Annual rents ensure peace of mind of at least a year for both tenants and landlords. Economies where tenants pay weekly rents are well regulated ones where no tenant would willfully stay smug in a rented apartment without paying his rents for months on end, while justice crawls in the courts, as we have it in Nigeria today. Such non-paying tenants in these countries would find themselves out in the winter cold. But, not in Nigeria, where tenants can stay in houses for years without paying, thumping their noses at their landlords.
Happily, however, the economic downturn may soon turn the nation into a tenants’ market as more and more houses, especially in the nation’s major cities such as Lagos and Abuja, are becoming vacant on account of the inability of prospective tenants to pay high annual rents.
There are houses in some of these cities that have been vacant for months and in some instances, years, on account of the insistence of the landlords on two years’ rents.
Many people who cannot pay their rents on account of job losses and vicissitudes of life have simple relocated to the outskirts of major cities where houses are cheaper and landlords are not so demanding, while some even relocated to their villages, where they do not have to pay any rents at all. So for now, many of the houses are vacant, but the landlords are still playing God, and refusing to reduce the rents. However, they will eventually do so, if the bad times persist.
Housing is such a critical aspect of living that it behooves the government to invest massively in it to ease the pains of the people. It is one of the essential needs of man on which this administration must double its efforts if it is to leave a lasting impact in the sector.
Re: Plateau: When will the killings end?
Your last article on the killings in Plateau is a masterpiece. The issue is that there is a colossal unholy alliance between the Nigerian state and Fulanis. The Fulanis who migrated from Futa Jallon in Guinea want to make Nigeria the home for all Fulanis in the world. The killing is based on the politics of land. It will surely spread to the states in the South unless Nigerians vigorously and ferociously resist the wickedness.