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Sanwo-Olu, Fashola Urge States To Enact Laws To Collect Monthly Rents
- Fashola said the onus was on States to look into the rental system, noting that rent control is the exclusive preserve of sub-national Governments.
- Mr Sanwo-Olu urged policymakers to consider the suggestion and initiate a regulatory framework that would aid the transition to the new rental system.
Ekohotblog reports that the Minister for Works and Housing Babatunde Fashola SAN and Lagos State Governor Babajide Sanwo-Olu have called on states to make laws that will compel landlords to collect monthly rents from tenants.
They made this call at the just-concluded 10th meeting of the National Council on Lands, Housing and Urban Development with the theme: “Housing Development as a Catalyst for Job Creation, Social Inclusion and Economic Development” held in Ikeja, Lagos.
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Mr Sanwo-Olu said the current rental model in which people remit yearly rent in advance to property owners had become inadequate to address contemporary realities in the housing sector, especially in cities where demand for properties is high and expensive.
The governor advocated a monthly rental system, which, he said, would be affordable to low- and middle-income earners who are pressured by yearly rent obligations.
The Minister for Works and Housing, Babatunde Fashola, SAN, corroborated the Lagos governor’s position in his submission, stressing that the yearly rental system had created inequality in housing supply and widened the affordability gap for low-income earners.
Mr Sanwo-Olu urged policymakers to consider the suggestion and initiate a regulatory framework that would aid the transition to the new rental system.
The governor said Lagos was already working out monthly rent modalities to accommodate residents not keen on the state’s home-ownership scheme.
He said, “In building homes, we do not only enhance the family ecosystem by providing a decent setting for raising future leaders, we also strengthen the economy through provision of economic engagements for professionals, artisans, suppliers, home decorators.
“In delivering decent shelters, we must care for both low-income and high-earners because housing is such a basic human need for everyone.
“In Lagos, we operate a very robust Rent-to-Own programme of five per cent down payment and six per cent simple interest rate payable over a period of 10 years. We are working on another product, which is a purely rental system, where residents will pay monthly. This is to accommodate those who are not keen on homeownership and address current realities. In doing this, we believe that no one would be excluded from our intervention in this critical sector.”
The governor listed the progress recorded in the last two years of his administration in the housing sector, pointing out that his government had raised the housing stock in Lagos by the completion, delivery and commissioning of no fewer than 10 housing schemes spread all over the State.
Mr Fashola, a former governor of Lagos, said the monthly rental model may not translate to making all Nigerians homeowners, but it would help reduce the number of citizens who lack decent shelters and live on the edge.
The minister said advanced payment of rent had created a mismatch in wealth distribution by putting more money in the hands of the rich at the expense of low-income earners. The way out, Fashola said, is to reverse the system by bringing monthly income close to monthly rent obligation.
“Our country would be a much better place when rent in advanced for the middle class and working families’ residential homes becomes rent payable at the end of the month. Asking someone to bring three years advanced rent of what he earns monthly in arrears is creating a huge mismatch,” said Mr Fashola.
“This is a source of inequality and we can do a lot to reduce it. The day our rent obligation moves closely or equals to our income receipt, this place would be a fairer place.”
The minister said the onus was on States to look into the rental system, noting that rent control is exclusive preserve of sub-national Governments.
The audience at the event comprised Commissioners for Housing and Urban Development across 36 States, Permanent Secretaries in the States’ Housing ministries, lawmakers on Housing Committees, surveyors, town planners, builders and other experts in the built industry.
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