The border settlements of Lagos and Ogun (in southwestern Nigeria), including Ojodu-Berger, Akute, Warewa, Arepo, Magboro, and Sango, are seeing a spike in rental costs.
In Warewa, Arepo, and Magboro, rental values have increased between N1.3 million and N1.5 million annually for three-bedroom properties and N800,000 for two-bedroom properties, according to a Nigerian Tribune poll.
It has been harder for those looking for housing because the majority of landlords and property owners in these neighbourhoods used the rising costs of construction and upkeep as justification for their actions.
Some said that inflation and Naira devaluation were the reasons for the increase in rental values, which was necessary to make up for the currency’s decreased purchasing power.
They claim that rental values will keep rising until the government takes action to solve the problems of unstable foreign exchange, inflation, and the high cost of building materials.
According to Sulaimon Agbabiaka, an agent in Alimosho and one of the landlords, there is no way to stop the rent from rising given the current situation.
“Due to rising building material costs, house rent will undoubtedly increase. In addition, another factor is the fact that many property owners obtained bank loans for construction, which they now have to repay with interest,” Sulaimon Agbabiaka said.
He claimed that most landlords in the Alimosho region have raised their rent.
For instance, he claimed that the rent for a two-bedroom apartment and a three-bedroom apartment, respectively, had increased to N1 million from N800,000 and N700,000 previously.
He claims that there is more demand than supply for two-bedroom apartments in Alimosho, which explains the N1 million price tag.
One of the main effects of growing inflation and currency devaluation, according to SmallSmall co-founder and CEO Tunde Balogun, is an increase in rental costs.
He asserts that property owners and landlords must modify their rental rates to make up for the declining purchasing power of the Naira as its value declines.
He claimed that this has increased the cost of property rental for both individuals and businesses, placing a burden on their budgets.
“Time is unfortunately not on our side as a country, even while I believe that we should give the current administration some time for their plans to fully take effect. The government should think about implementing some severe measures to allay the public’s mounting worries and annoyance,” Balogun said, while suggesting that it might be as simple as the president telling the country on television at least once a week that things will improve.
Another expert, Stephen Jagun, stated that the rising cost of building materials is already causing a significant rise in rent.
“It is the basic law of supply and demand. We simply have too much demand,” he remarked.
He said that it would undoubtedly be extremely expensive and that developers would struggle to recover their investment through sales or leases.
“The rent will reflect the investment, and if they want to sell, the price will be embarrassingly high,” he stated.