Why House Rents On The Mainland Keeps Increasing

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There is generally a crisis of house rent in Lagos, as more and more average Lagosians are finding it hard to live within the city due to the sudden arbitrary in house rent.

Many tenants in low-cost areas where 2-bedroom apartments used to cost between 300,000 to 500,000 naira are now being asked to pay over a million for the same apartment. Some of the locations affected are Iyana Ipaja, Agege, Ikotun, Egbe, Idimu, Egbeda, Iyana Oworo, Mile 12/Ketu/Ojota, Alapere, Ojodu, and others. Some of these places are already facing a crisis as their rents have increased drastically. Some increases are over 150 to 200 percent, and this has become a major issue, while new or potential tenants face several challenges before they can secure a new apartment of their choice.

There are several reasons why house rent keeps increasing on the Low cost areas mentioned above.  City People, Isaac Abimbade, went around and identified several factors.

Currently securing a new apartment of your choice has become a significant challenge. The house Agents, Lawyers, and Lagos State government have made the process more cumbersome. Additionally, Lagos building agencies like LASPPPA  (Lagos State Physical Planning Permit Authority) and LASBCA (Lagos State Building Control Agency), along with several others, have driven up housing and rent costs by imposing high permit fees, requiring mandatory consultancy and professional reports, and causing project delays that force developers to pass compliance costs to buyers and tenants. Especially on the island, we found that developers spend at least 10-30 million on average to perfect their building titles from these agencies. Before beginning a project, several millions of naira are spent to obtain building approval from about six or seven Lagos State building Agencies. Once construction starts, LASBCA requires mandatory stage-by-stage certifications, including inspection and compliance fees calculated as a percentage of the initial building plan. Navigating government offices, document verifications, and tax clearance processes can take anywhere from months to years. This bureaucratic delay ties up invested capital and results in significant loan interest accumulation, which further drives up the final value of the property.

Also,  In Lagos, house Agents significantly drive up rent by exploiting the massive gap between high housing demand and limited supply, alongside inflating auxiliary fees. To maximize their commissions, agents frequently pressure landlords to hike prices or deliberately inflate the final asking price to keep the extra profit.

Millions of people move to Lagos annually for work, creating intense competition for housing. Agents take advantage of this high demand and low supply by auctioning apartments to the highest bidder.

Beyond rent, Agents often add opaque or “illegal” fees—such as exorbitant agreement, legal, and caution fees—which can double the initial amount a renter is required to pay.

Agents earn a percentage (usually 10% to 15%) of the total rent. By convincing landlords to raise the base rent, agents directly increase their own payout.

Do not also forget that sudden inflation in Nigeria has drastically increased house rents in Lagos through a domino effect of surging construction costs, currency devaluation, and a massive housing deficit. With the influx of thousands of people into the city daily, the demand for housing heavily outpaces the constrained supply.

The cost of importing or purchasing essential building materials—such as cement, iron rods, and electrical fittings—has skyrocketed. This forces developers to pass these expenses onto tenants, while landlords of older properties also increase rents to fund costly renovations.

Lagos battles a structurally constrained housing supply, with an estimated deficit of over 3 million units. When combined with the constant daily migration of people seeking economic opportunities, this high demand and low supply allow agents and property owners to arbitrarily raise prices.

Property owners face inflated costs for basic utilities, tenement rates, and informal community levies (such as those paid to Omonile). These compounded charges are ultimately transferred to the tenant.

The devaluation of the naira has increased the cost of importing foreign building materials and fixtures, significantly raising the capital required to build or maintain properties.

Experts in the sector have also explained that the cost of construction materials such as cement, steel, tiles, roofing sheets, plumbing fittings, and electrical components has continued to rise over the past few years, making property development and maintenance increasingly expensive. As a result, landlords often transfer part of these additional costs to tenants through rent adjustments and higher service charges.

The depreciation of the naira and rising fuel prices have also contributed to increased expenses within the real estate sector. Many residential estates and apartment buildings in Lagos rely heavily on private power generation due to irregular electricity supply, forcing landlords and facility managers to spend more on diesel and energy maintenance. Transportation costs associated with property maintenance and logistics have equally risen, further increasing operating expenses within the housing market.

Another reason is the frequent demolitions on the mainland and across the metropolis are a major factor driving up house costs and rent.

When unapproved or illegal structures are pulled down, it creates artificial scarcity by removing thousands of housing units overnight, leaving displaced families and investors competing for fewer available properties.

Displaced residents from demolished waterfronts and informal settlements relocate to more stable mainland areas like Yaba, Surulere, Iyana Oworo, Makoko and Ikeja, increasing demand and rent in those.

The Lagos State Government has recognized the extreme burden on residents and has pushed forward legislation, such as the proposed Tenancy Bill, to regulate indiscriminate rent hikes, limit upfront agent fees, and make monthly rent payments the standard. But can the government effectively regulate the sector?

If you are struggling to keep up with rising costs, you might want to consider looking at fast-developing border towns where rent remains more moderate, or explore property investment platforms that offer fractionalized or shared accommodation options. You can track ongoing housing policy discussions and tenancy law reviews on the Lagos State Government official portal.

–Isaac Abimbade

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