The Nigerian Institution of Estate Surveyors and Valuers urged the Federal Government and states to be cautious in the introduction and implementation of monthly rent payment scheme in the country.
According to the organisation, enforcing the implementation of the scheme may discourage potential and existing investors in the real estate sector. It would be recalled that the Senate had, recently, commenced deliberation on a bill seeking to stop landlords from demanding the payment of advanced rent from their tenants.
The bill also plans to outlaw the payment of rents beyond a period of three months. Titled, “Advanced Rent (Residential Apartment, Offices Spaces etc) regulation Bill 2022’’, the bill was sponsored by Senator Smart Adeyemi of Kogi State.
However, the President and Chairman of Council, NIESV, Emmanuel Wike, warned that any mode of enforcement, whether by law or public regulation, should be handled with kid gloves, warning that failure to do could lead to depleted investments in the real estate sub-sector.
Speaking to journalists in Uyo, Akwa Ibom, he said:
“Housing is an inelastic social good or service, with substantial shortages at the urban low and medium-income subsectors of the market. That re-establishment, however appealing it may be, requires careful planning and systemic implementation, so as not to exacerbate the difficulties.
“In the face of the available evidence, monthly payment of rents will not work presently. The parties involved will circumvent it by agreeing at the same time 12 monthly contracts at once and in advance.”
He added, “Any move to enforce implementation by law or public regulation will scare away investors from that subsector of the housing market, thereby further worsening the shortage. The end result is the compounding of the housing problem instead of proffering some solution.
“In the long-term, the way forward is to take a balanced position, push for public discourse that should generate the buy-in for a mutually beneficial policy for renters and landlords. The ongoing conversation is a good start and should be built upon to generate consensus through more stakeholder (landlords, investors, tenants) engagements and buy-ins, identification of needed special interventions, leading to carefully formulated policies with robust implementation procedures, and implementable fast-track mechanisms for conflict resolution.”