Nigeria’s worsening economic pressures have led to an upsurge in rent defaults, with tenants increasingly favoring annual rental payments despite government efforts to promote monthly options.
Inflation hit 34.6% in November 2024, causing rents in major cities like Lagos to soar by up to 100%. This has intensified financial hardships for tenants, many of whom face stagnant incomes and high unemployment. Reports indicate that about 80% of properties under some landlords face rent arrears, prompting frustrations and considerations to sell.
The Lagos State Tenancy Law further complicates the situation, making it difficult for landlords to reclaim properties from defaulting tenants. Investors in the real estate sector have grown wary, with many adopting a “wait and see” approach due to economic instability and exchange rate volatility.
Interestingly, a recent BuyLetLive 2024 Housing Market Survey revealed that 62.6% of Lagos residents still prefer yearly rental payments over monthly fees, despite the government’s plans to introduce an online monthly rent payment platform aimed at boosting affordability and revenue.
The survey also found that most Lagosians prefer rents between ₦1 million and ₦3 million annually, while demand remains high for two-bedroom (38.2%) and three-bedroom (35.5%) apartments. Meanwhile, 36.4% of respondents expressed interest in relocating within the next six to 12 months. Experts warn that without targeted government interventions such as rent control and the creation of affordable housing, the situation may worsen, leaving tenants and investors trapped in a cycle of rising costs and economic uncertainty.
