24th April, 2013
By Sola Ogunmosunle
Just recently, the media was awash with the news of a Lagos property developer cum estate agent who duped over a hundred prospective accommodation seekers tens of millions of naira. The agent was reported to have collected various sums of money from the prospective tenants over and above the only twenty four available apartments in the property. This, however, is not an isolated case as it is now a commonplace occurrence as the atrocious estate agents have become a source of sorrow for the hordes of accommodation seekers in Nigeria.
In our major cities, particularly Lagos, where housing has always been a critical issue, the perception of the populace on the activities of estate agents is that of greed, deceit, distrust, trickery and extortion, Lagosians, if presented with a choice will rather keep estate agents at arm’s length. It must, however, be noted that there are still a few honest and professional agents out there, but very hard to come by!
Accommodation seekers in Lagos are more vulnerable to the whims and caprices of the estate agents for obvious reasons. Lagos is the largest conurbation in Nigeria and the second most populous city in Africa. It is currently estimated to be the 7th fastest growing city in the world and its population is also estimated to be between 15 and 17 million people and by projection may rise to about 25 million by the year 2015. The implication of this projection is that about 3,000 people migrate to Lagos daily! Being the former seat of government in Nigeria and the commercial nerve centre of the West African sub-region, Lagos has always held attraction for the proverbial greener pastures seekers.
These and other factors such as failure of successive governments to address the extreme deficit in housing stocks and establish a regulatory mechanism that can bring about solutions to the problematic housing sector are some of the important reasons why many would-be tenants are at the mercy of these so-called quack estate agents.
Due to the high level of unemployment in the country and most unfortunately because the estate agency business is not regulated in any form, it has become an all comers affair for touts, dropouts and people of questionable character. It is also pathetic that many unscrupulous property owners have also found an ally in these quack agents. The frustration being experienced in the implementation of the Lagos State Tenancy Law is a direct consequence of the connivance of these agents and shylock landlords. Due to this landlord-agent collusion, it is not uncommon for prospective tenants to be exploited by being asked to pay all manner of agency fees that are usually over and above the principal rent. Tenants are also compelled to pay higher rents over and above the prevailing rates in order to find ways to circumvent the tenancy law that prohibits advanced rent in excess of a year. Their tricks are just innumerable! Even at that, some of these agents’ activities are inimical to landlords.
Despite the fact that the nefarious activities and antics of these unscrupulous estate agents are not hidden to accommodation seekers, they are left with not very many options simply because of lack of accommodation in Lagos. Whenever prospective tenants remind the estate agents of the state’s tenancy laws, they simply give a wave of the hand and sarcastically advise the tenant “to go rent a house from Fashola” i.e. the governor of the state.
The activities of estate agents have always been a source of headache to other professionals and stakeholders in the estate business. Architects, Estate Surveyors and Valuers, Civil Engineers and Builders and other professionals in the property business have been making efforts all along to separate the chaff from the wheat with little or no success. Their intention to sanitise and restore integrity to the sector has been in futility due to the absence of a legal framework on which their efforts could be galvanized.
The Lagos State Government, as part of its responsibility to see to the welfare of the citizenry, is set to provide the missing link in the quest to checkmate the rate of disturbing neglect and fraud ravaging the state in the real estate sector. Efforts are now in top gear to kick-start the enabling law (passed since 2007) that empowers the government to actualise the regulation and control of estate agency and property development in the state. The Lagos State Government has, therefore, prepared a set of rules and regulations for the practice of Estate Agency in the state in order to protect the citizens and reduce the tendency for fraudulent practices. The government is interested in capturing data on property transactions on a regular basis as it is being done in most developed parts of the world.
One of the steps taken to kick-start the law is the establishment of Lagos State Real Estate Transactions Department to strictly monitor and regulate the practice of estate agency and prosecute those who contravene the laws on Real Estate in the state. The office will be a one-stop shop for all activities and enquiries on real estate transactions in Lagos State.
This Estate Agency and Property Development Law is part of the State’s integrated approach to ease the pressure on shelter as documented in its Ten Point Agenda. The Tenancy Law and the Home Ownership Mortgage Scheme (HOMS) are also part of government’s efforts to solve the housing problems in Lagos.
It is pertinent to state now that as much as the government is committed to the regulation of this noble profession, legalistic approach alone may not be enough to solve the problem of quack agents. It must be a collective resolve to push the dubious agents out of business. Every stakeholder in real estate sector must join hands with the government to make a success of the efforts. The purpose of this regulation is not for revenue generation as being touted in some quarters and as such self compliance will greatly benefit all the parties. The government on its part must demonstrate, as it has done in the past, a committed spirit to ensure that this regulation is given enough ‘teeth’ to bite whenever it is necessary.
•Ogunmosunle is of the Features Unit, Ministry of Information and Strategy, Alausa Ikeja