Rent Defaults Escalate As Rising Costs Deepen Landlord-Tenant Disputes

Persistent rent defaults are intensifying disputes between landlords and tenants, as property lawyers and real estate experts warn that many Nigerians can no longer keep pace with surging rental costs.

Findings show that nearly 90 per cent of landlords in the residential sector have raised rents within the past year, with more than a third planning further increases before Christmas. Experts argue that this trend underscores the unrelenting pressure in the rental market, where inflation continues to squeeze disposable incomes.

Unlike homeowners, who spend an average of 26.6 per cent of their earnings servicing mortgages, tenants are seeing rental payments consume a disproportionate share of their income. This widening gap has eroded renters’ confidence in ever transitioning to home ownership.

Real estate expert and chairman of the Association of Capital Markets Valuers (ACMV), Mr. Chudi Ubosi, noted that rising defaults reflect the toll of Nigeria’s struggling economy on both businesses and households.

He advised landlords to prioritise dialogue with tenants before resorting to legal battles, warning that litigation often leaves properties tied up for years while tenants exploit the system.

“It is better to lose a year’s rent than remain stuck in court for four years,” Ubosi said. He urged landlords to explore flexible solutions such as temporary rent reductions, phased payments or mutually agreed settlement terms.

Chief Executive Officer of Greenchell Homes, Mr. Ezekiel Oke, observed that reactionary rent hikes are forcing tenants to renegotiate or seek cheaper housing alternatives. According to him, landlords’ cautious adjustments still reflect strong upward pressure on rental prices, with more than 90 per cent increasing rents in one form or another.

For Mr. Gbenga Oremeji, a Lagos landlord, the dilemma lies in balancing inflation with tenant stability. He explained that while landlords are compelled to review rents, many are mindful of maintaining occupancy and are watching closely for potential regulatory changes in the housing sector.

Industry analysts conclude that the rental market remains under severe strain, with no immediate signs of relief. Rising defaults, coupled with arbitrary hikes, continue to heighten tensions, leaving both landlords and tenants grappling with an increasingly fragile housing balance.