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Getting an apartment in Lagos, Nigeria’s economic hub, is challenging and sometimes frustrating.
“House hunting in Lagos is an extreme sport,” exclaims a disgruntled resident. Though it’s a similar case across most major cities in the country, Lagos residents appear to have the worst experiences.
The teeming population in these cities means there are limited spaces for residents, so using a housing agent seems like an excellent way to secure accommodation. For many people, however, this hasn’t been the case.
Perhaps affordability rather than availability is the major challenge. Depending on social class, people’s considerations usually range between finding a place to lay their heads to getting a comfortable apartment or renting a home with the necessary amenities.
The once-common ‘To Let’ signs are seldom seen on houses with vacant apartments in Lagos, probably because most spaces up for rent are now outsourced to agents.
Using an agent when house hunting in Lagos has been standard practice since the 80s.
A woman in her late 70s, who owns an old structure at Somolu, says agents became necessary when house owners no longer wanted to interact with tenants. The agents were brought in to eliminate haggling during meetings and handle situations where legal action has to be taken against tenants for breaching their tenancy agreements.
“Sometimes, these houses are inherited, and rental proceeds have to be shared among beneficiaries. Hence, one person cannot be put in charge because of trust issues,” she adds.
Housing agents are easy to find – through referrals or properties listed on classifieds websites but rather than ease the rental process, they seem to hamper it.
Most of these agents don’t commit to meeting up or taking prospective clients to an apartment without a registration fee, usually between ₦2,000 ($5.17) and ₦3,000 ($7.75). And this is separate from their service charge, which is not less than ₦40,000 ($103.37).
Sometimes, the same property is listed on different platforms, or recycled images and non-existent structures are shared online only for people to be taken to uncompleted buildings. These are the lucky ones as some others have fallen victim to scammers who take money from multiple clients after promising them the same property.
These challenges have seen digital platforms evolve with classifieds adding control measures and disclaimer clauses that provide security for users, but that hasn’t curbed the menace of fake listings.
Probably in an attempt to solve the problem, tech entrepreneurs are designing products with improved assurances. Since an agent’s role is integral in the rental process, home rental startups act as such. Instead of just linking concerned parties — landlord/estate agents and interested renters — only to continue transactions offline, all rent management concerns are sorted remotely.
With a few clicks, one can escape ridiculous agency fees and unnecessary down payments, prevent fraud, and pick from a list of suitable choices regarding location and pricing. With clearly defined features and cost implications, renters can conveniently book and pay for apartments on a daily, weekly, monthly, quarterly, or yearly basis.
Familiar names like Spleet, Muster, and Kwaba, among others, focus on young working-class people and students living in cities like Lagos and Abuja. These secure and flexible on-demand housing options are usually located in highbrow areas.
Real estate startup founders present a valid reason behind their platforms, to encourage periodical rent payments. For Obinna Molokwu, Kwaba’s CEO, “We don’t see any sense why renters should pay their rent yearly when their wages are paid monthly.”
But the question remains, are they addressing the affordability challenge?
Pricing seems to be an additional problem to Africa’s existing housing challenge, especially since the payment of a lump sum for rent is mostly required. This means that with a problematic credit system, paying a year’s rent upfront without savings will be difficult.
Mr Daisi, a Lagos resident, recalls that a six-month down payment was usually requested as far back as the 90s, but there were other settlements required apart from the standard rental fee.
“Then, the costliest apartments were as high as ₦500 (~$29.4*) monthly. Apart from this, you had to pay for agreement and commission, damages, and an upfront electricity bill for a year. But whatever you paid as damages was returned when you wanted to leave the house. Agreement and commission were usually the same amount and were shared equally between the agent and the landlord,” he explains.
This practice of paying rent in advance in Lagos isn’t entirely different in 2020, but monthly rent payments are no longer allowed. Sometimes, agents/house owners even request two years of the rental fee in advance. And since they vary with the apartment’s quality, the extra charges can turn out to be precisely the same amount as the rent or more.
Given the steep costs this will amount to and how discouraging it sounds, are digital platforms any different? It is highly probable that there is some social class profiling involved in the process, a claim these platforms will refute because an average salary earner might find it hard to afford their listed properties.
With a minimum wage of ₦30,000 ($78.65), as is the case with Nigeria, a salary earner will have difficulty considering these solutions. Excluding other monthly costs of living, the low-middle earners and professional workers in Nigeria, which are part of these platforms’ target market, may still not stand a chance.
Depending on how affluent the location is, a single bedroom mini flat can cost as high as ₦125,000 ($327.72) monthly. Not many in this social class will have this amount available. In general, people are still left to find a fair deal.
The rental and payment situation in Lagos isn’t alien to many other African nations. In the Republic of Benin, while payments are flexible, tenants are currently expected to pay a minimum of three months’ rent.
The need to secure an apartment through an agent usually comes with the location. For instance, getting an apartment is quite difficult in Cotonou compared to Porto-Novo, hence the need for agents who usually collect the value of a month’s rent for their service.
Trust, a resident, shares his experience house hunting; “I got a house recently, and I paid rent for four months, that means, three months advance and a recurring monthly rent payment. That means I will pay rent every month without having to use up the three months advance. The reason for this principle is to allow you to have money for another apartment if you decide to leave because the advance will be refunded when you do. Asides from this, you pay for utilities, light, water and damages which are also refundable.”
In Accra, depending on the area, using an agent may be necessary if you can’t contact the homeowner. From shared experience, it appears that Ghanaians are not exempted from their share of agents’ cruelty as some ask for two years’ rent payment.
“Aside from the rent, in most cases, you’ve got to pay the agent 10% of the rent if the apartment is not furnished. If it’s furnished, you pay the agent an equivalent of a month’s rent.
It’s also important to note that some landlords collect a mandatory fee of GH₵ 500 to GH₵ 1,000 as a deposit to cover for any damage during your stay in the house. Some also accept one to six months utility bills in advance,” Delali explains.
For Kenya, the advance payment is similar to Benin Republic’s and can even go as low as one month’s deposit with some fixed charges for utility. For instance, an average unfurnished room could cost between Ksh 3,000 and Ksh 15,000. You can also bypass agents’ services if you are willing to do the leg-work and search for a house yourself.
“First, I do online and offline research,” says Nicole, a resident of Nairobi and Kisumu, Kenya, “I mostly research offline asking friends and family if they’ve heard of an empty place. Still, with the changing times, online has proved to be more effective. In terms of online, sometimes I make use of websites like jiji.co.ke where landlords/agents post houses available for rent.
“Then comes the viewing step where I go and see the houses so that I can filter depending on factors like location (how close it is to school or work), water availability, security, noise, and sometimes aesthetics (how the house looks). Also, the payment plan is sometimes a huge factor.”
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