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Enitan believes that rent control is harmful to Nigeria’s housing investment.

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After the recent government proposal to introduce a law mandating monthly rental payments in the country, Sola Enitan, the Founder and Chief Executive of Comwell Professional, has cautioned against its implementation, citing that rent control could be detrimental to Nigeria’s housing investment sector.

Enitan argues that the government cannot regulate what it doesn’t produce and emphasizes that the free market system plays a crucial role in attracting investments across various economic sectors.

In his article titled "Stop Distorting the Housing Market: Rent Control is Injurious to Nigeria’s Housing Investment Sector," the estate surveyor and valuer highlighted that recent comments from officials in Lagos and Abuja regarding escalating house rents and the conventional yearly rental payment practice indicate a lack of understanding of how the housing market functions.

He argued that if government could not find a peg for the drowning Naira, how would it hope to achieve rent control which responds directly to governments failure at achieving financial stability.

In examining the home rental market in Nigeria amidst high-interest loans, negative equity, and two-year rent advance payments, Enitan pointed out that several factors contributed to the incongruence between desirable monthly rent payments and the challenges faced by landlords.

On high mortgage interest rates, the professional said the prevailing high-interest rates on mortgage loans have made it financially burdensome for landlords, who would have financed property acquisitions through loans.

“The monthly rental system, in many cases, does not align with the high-interest payments on mortgages, affecting the profitability of rental properties.

“In other words, government will drive more and more investment out of the housing sector into other more profitable areas. With housing deficit knocking 22million as it were, any further pressure on the sector will engender extreme homelessness,” he said.

He said that negative equity referred to a situation where the rental payments

made on houses by tenants is lower than the interest rates the landlords have to pay on a monthly basis to the mortgage loan provider.

“It can also reflect itself as a situation where the market value of a property falls below the outstanding mortgage balance, which places landlords in a challenging position and could further exacerbate corruption in the economy of the nation as landlords seek alternative sources of home loan repayment. It becomes difficult for them to cover mortgage payments through monthly rents, especially when property values don’t measure up. Nigerian housing market is perpetually under a negative equity system,” he said.

He elaborated on how the traditional practice of demanding tenants to pay two years’ rent upfront served as a workaround for landlords dealing with a flawed mortgage system.

While acknowledging the financial burden this payment method places on tenants, making it tough for them to manage their finances effectively, he stressed that advocating for monthly rental payments or any form of rent control enforced by the government could lead to severe cash flow challenges for landlords.

To transition towards monthly rental payments and alleviate the struggles faced by landlords, he urged the government to explore various measures, including but not limited to interest rate subsidies or mortgage refinancing programs, property value support initiatives, affordable housing projects, financial education efforts, partnerships with financial institutions, and tax incentives for landlords, among other strategies.

He highlighted that by addressing these aspects and implementing supportive policies, the government could contribute to establishing a more sustainable and equitable home rental market in Nigeria. This approach would ensure that both landlords and tenants benefit from a fair and economically feasible system.

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Lagos schedules meeting with owners of distressed buildings.

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The Lagos State Government has said it would soon arrange a meeting with developers/owners of distressed buildings on how best to address the redesign and remodelling of such structures by November.

This was disclosed recently by the Commissioner for Physical Planning and Urban Development, Oluyinka Olumide, at a function in Alahusa, Lagos.

Olumide said the prevalence of distressed buildings in different parts of the state was worrisome and needed the urgent attention of all stakeholders.

He said, “The Ministry of Physical Planning and Urban Development as mandated by the Lagos State Urban and Regional Planning and Development Law, 2019, as amended, was willing to extend its responsibility for approving the remodelling of existing buildings to provide technical assistance to developers and owners of distressed buildings, especially on the design and remodelling of such buildings.

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FG threatens contractors over Enugu-Onitsha road delay

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The Federal Government has instructed the contractors responsible for the 107km Enugu-Onitsha road dualization to expedite the project.

This directive was given by the Minister of Works, Senator David Umahi, during a meeting with MTN, the Enugu State Government, and the contractors, RCC Ltd and Nigercat Ltd, on Friday.

According to a statement released on Friday, the minister said he is disappointed over the slow pace of work on the project, he said, “Let me express my disappointment over the slow pace of work on that project. It is one of the worst roads in this country.

“Everywhere we have diversion; diverting from the one that RCC and Nigercat had completed, the contractors are not kind enough to even put stone based on the diversion points.”

He added, “So, by the reason of the launching of our Operation Free our Roads, it is now a violation of the policy on the side of the controllers and directors of the Federal Ministry of Works where we have vehicles falling on any project that is ongoing or where there are potholes on our roads.”

He also blamed the sufferings of road users on the lack of commitment and insensitivity of the contractors.

“The public must know that the President’s intention is not for them to suffer while trying to fix the roads, and it is their right to insist that contractors should fix the roads that they are engaged on,” he said.

The Minister commended the Enugu state government for their resolve to fund the construction of a 20 KM section of the road and expressed hope that MTN would execute the second phase of the project.

He noted, “Why the Enugu State government is intervening is because of the slow pace of work by the contractors and because of funding issues. The essence of tax credit is for funds to be made available. And so, I don’t see RCC going to keep their promise to finish this project in 6 months.

“My advice to MTN is to look for another contractor within that axis if they want to get the job done. Division of labour is even the best. While they are doing the road, and if Nigercat is doing a good job, you can give them greater scope to do if you want to finish that job.”

He warned contractors that the Federal Government would not accept phased handovers of projects and has phased out Variation of Price in contract administration.

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Ekiti state government mediates land dispute between traditional ruler and family in Epe-Ekiti

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The Ekiti State government has intervened to resolve a longstanding land dispute between the Elepe of Epe-Ekiti, Oba Ayodele Adesoye, and the Atolagbe family. The government cautioned against the misuse of modernization as an excuse to disregard traditional customs.

In line with the community’s traditions, the government has ordered the release of resources, including palm trees at Oko Oba Farmland, to Oba Adesoye for his administration. This decision ensures the continued adherence to age-old practices.

Ekiti State Deputy Governor, Chief (Mrs) Monisade Afuye, announced the resolution in Ado-Ekiti. The decision was made after considering the Elepe’s claim to Oko Oba Farmland based on historical evidence.

Mrs. Afuye acknowledged the Elepe’s right to be the custodian of Oko Oba Farmland, citing longstanding traditions that support his claim. The decision reflects the importance of respecting historical practices and ensuring their preservation.

The deputy governor, however, told the monarch in clear terms that other princes and princesses from all the three ruling houses should be allowed to farm on the land without payment of royalty.

Mrs Afuye appealed to the community to comply with the government’s position to restore unity, peace and orderliness to the beleaguered community.

Oba Adesoye expressed gratitude for the government’s decision and pledged to foster peace and unity between the throne and the community, aiming to accelerate Epe’s development.

Representing the Atolagbe family, Dr. Yemi Agbeleoba acknowledged their willingness to cede Oko Oba Farmland to the monarch. However, he emphasized the need for all three ruling houses to participate for a lasting and traditional solution.

Agbeleoba expressed appreciation for the government’s directive, believing it will contribute to resolving the long-standing conflict.

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