*The Lagos state monthly rental scheme is scheduled to kick off this year
*Under the scheme, interested residents will need to apply to a body to be set up by the government
*The body will be responsible for disbursing loans to tenants with which they will pay their rent and thereafter pay back monthly, with interest
Lagosians were thrilled when Lagos State governor, Babajide Sanwo-Olu late last year during the Lagos Real Estate Market Place Conference and Exhibition, announced that the residents in the state will beginning from January this year be able to pay their rents monthly.
However, how this will play out and the process it will take was something that remained unclear to many.
Toke Benson-Awoyinka, special adviser to the state governor on housing, had explained during a discussion on Rental Policies at the event that the new initiative was a social investment scheme initiated by the state government to ease the burden of yearly rent payment on residents.
According to Debo Adejana, Chairman, Real Estate Developers Association of Nigeria (REDAN), South West zone certain procedures have been been put in place by the Lagos State government and these are as follows:
The government will be setting up a body that will act as an intermediary between Landlords and tenants.
Prospective tenants will be seek and obtain a one-year loan from the new body with which they will pay their landlords one-year rent, but repay the loan monthly.
So this essentially means that under the scheme, the government intermediary will pay the rent on behalf of tenants and they simply repay the loan back to the scheme in bits every other month although with interest as the amount to be paid back will not just be the exact rent.
According to him, another good part of the scheme is that a portal will be opened where tenants could go to search for rental properties of their choice. The portal would also be open to landlords who might wish to place their properties therefor rent.
Tenants who are interested in the scheme, which will be starting with the formal sector, must be registered residents of the state and must be up-to-date in their tax obligations to the state.
Allaying fears of some that the interest of investors or landlords may be at stake, Moruf AkinderuFatai, the state’s commissioner for housing, dismissed these fears, assuring that the government would protect the interest of investors, tenants and landlords and would guard against payment default or abuse from tenants.
“There is a system we are working on to make sure that the tenants, landlords and our private sector partners in this scheme are protected,” the commissioner said at an interactive session with property editors.
Continuing, he assured, “aside talking to the private sector and investors to see how they can help, we are also doing our part alongside our partners who have the same interest because not everyone can buy a house.”
In a state where estimates have it that more than 60% of the entire population are tenants, the initiative has been lauded as a worthy one.
