The Lagos State Government on Monday revealed plans to commence the state’s monthly rental scheme, which will be enforced before the end of 2024 or early next year.
The Special Adviser to Governor Babajide Sanwo-Olu, Barakat Odunuga-Bakare disclosed this during a press briefing of the State Real Estate Regulatory Authority held in Ikeja, the state capital.
“We all see what is being done in other climes, rents are collected monthly. Hence, we are looking and hoping that before the end of the year, or by early next year, we will be able to implement the policy of monthly rental. Also, the rental would be charged according to tenants’ earnings.
“The good part about it is that we would be test-running it first within the public sector since we can ascertain how much everybody is earning, and once we see that it works in the public sector, we can now push it out to the private sector,” she added.
She emphasized that the N5bn allocated for the monthly rental scheme was still set aside and unexpended.
Odunuga-Bakare, stressed that the fact that the scheme was slow to take off showed that the Lagos State Government was still working assiduously to enforce the scheme.
The Special Adviser to the governor on Housing explained that the last administration that initiated the monthly rental scheme was coming to an end when the scheme was to be introduced noting that the Sanwu-Olu led administration wants the scheme to come into effect by the end of this year or early next year.
It would be recalled that in 2021, the Governor of Lagos State, Babajide Sanwo-Olu, had disclosed that the current rental model in which people pay yearly rent in advance to property owners has become inadequate to address the present realities in the housing sector, especially in cities where there is always a high demand for property.
While making a recommendation at the 10th meeting of the National Council on Lands, Housing and Urban Development held in Lagos recently, the governor maintained that a monthly rental system would be affordable to low- and middle-income earners pressured by the yearly rent obligation.
He urged policymakers to rally round the suggestion and initiate a regulatory framework that would aid the transition to a new rental system.
Sanwu-Olu stated that Lagos state was already working out monthly rent modalities to accommodate residents not keen on the state’s homeownership scheme.
“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 10 years. We are working on another product, which is a purely rental system, where residents will pay monthly.”
He added. Earlier, the then Minister of Works and Housing, Babatunde Fashola, corroborated Sanwo-Olu’s position, emphasizing that the yearly rental system had created inequality in housing supply and broaden affordability gap for low-income earners.