Rental rates in Lagos’ border communities on the increase

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Rental rates in Lagos- Ogun’s border communities such as Ojodu-Berger, Akute, Warewa, Arepo, Magboro and Sango, among others, are on the increase.

According to a survey by Nigerian Tribune, in locations such as Warewa, Arepo and Magboro, rental values have jumped between N1.3 million and N1.5 million per annum for three-bedroom and N800,000 for two bedrooms.

In fact, it has become tough for accommodation seekers as most landlords and property owners in these neighbourhoods justified their action, citing the rising costs of building materials and maintenance.

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Some said the increase in rental values was necessitated by Naira devaluation and inflation to compensate for the reduced purchasing power of the currency

According to them, untill government addresses the issues surrounding volatile foreign exchange, inflation and high building materials’ costs, rental values would continue to rise.

One of the Landlords and also an agent in Alimosho, Mr Sulaimon Agbabiaka, said there’s no way to stop rent’s increase going by the reality on ground.

“House rent will definitely increase because the cost of building materials has increased. Besides, the fact that many property owners secured bank loans to build and have to pay back with interest is another reason,” Agbabiaka said.

In Alimosho area, he said that most landlords have jacked up their rents.

For example, he said that rents for a three bedroom and two bedroom, respectively have risen to cost N1million each from N800,000 and N700,000 before now.

According to him, demand for two bedroom apartments in Alimosho is more than supply, hence the N1million price tag

Co-founder/ CEO, SmallSmall, Tunde Balogun, pointed out that one of the key consequences of rising inflation and currency devaluation is the increase in rental prices.

According to him, as the value of the Naira decreases, landlords and property owners have to adjust their rental rates to compensate for the reduced purchasing power of the currency.

This, he said has made it more expensive for individuals and businesses to rent properties, putting a strain on their finances.

“Whilst I agree that we need to give the current government some time for their policies to take full effect, sadly time is not on our side as a nation. Government needs to consider taking some drastic measures to alleviate the growing concern and frustration of the masses. It could be as little as the president addressing the nation on television at least once a week, reassuring us the citizens that things will get better, “ he said.

Going by the increase in the building materials prices, another professional, Stephen Jagun, said: ‘This already is leading to serious increase in rent.

“ It is a simple law of demand and supply. Simply put we have excess demand,” he said

According to him, the cost of construction would definitely be outrageous, adding that developers would find it difficult to recoup their investment either by selling or leasing out.

“If they want to sell, the price will embarrassingly high while rent to match the investment will be realised,” he said.