•An estate
Stakeholders in the real estate industry have stated that rents will not reduce in the housing sector despite the removal of the Value Added Tax (VAT), as the move is not capable of addressing the issue of the exponential rise in the sector.
In the recent period, rents payable by tenants of houses have increased tremendously, and this has left a huge deficit in monthly expenditures for many Nigerian families, reports Daily Independent.
The Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, who stated that VAT is already exempted on land, buildings and rent under the Nigeria Tax Act currently being implemented, seemed not to know that the sector is reeling under intense tax pressure.
However, property experts insist that the real drivers of high rent lie elsewhere.
This comes against the backdrop of rising public frustration over escalating rent prices nationwide. In major cities such as Abuja, Lagos, Kano, Enugu and Port Harcourt, rent prices have surged dramatically.
In Abuja, for instance, the annual rent for a one-bedroom apartment has climbed by more than 100 per cent, rising to between N1.5 million and N2 million from previous rates of N500,000 to N1,000,000 in areas such as Dawaki, Jabi, Jahi, Kubwa, Dutse, and Nyanya. Similar increases have been recorded in other major urban centres.
In many cases, annual rent now exceeds the yearly earnings of a worker on Nigeria’s N70,000 minimum wage.
Speaking exclusively, the former President of the Real Estate Developers Association of Nigeria, Aliyu Wamakko, and the President of the Association of Abuja Tenants, Hakeem Suleiman, said the focus should shift from VAT removal to addressing the soaring cost of building materials, particularly cement.
Wamakko said, “First and foremost, it is only land that they removed the Value Added Tax on.
“The real issue is the cement price. Because the primary thing that we build houses with is cement. And now the issue is that cement is more than N10,700 per 50-kilogram bag. Even at the factory price, cement is N10,500 now.
“And the more they build roads with cement, the more cement goes up.
“Because the demand now is going to go high. And once the demand is high and the supply is low, there is every opportunity for the community to increase costs, and every variable on that commodity will definitely increase.
“Be it rent, be it a house, be it whatever, as long as it is dependent on cement as the primary product to produce that product.
“Looking at it, there is an over 14.9 million housing deficit in Nigeria, which centres around the four major cities.
“That is Abuja, Lagos, Kano, and Port Harcourt. But the reality of the issue is that as long as the building materials are going up, there is no way you will get a reduction in prices.
“Honestly, there is no hope. If the renewed hope would really renew the hope, it should start from the reduction of cement price, at least in the aspect of real estate,” he said.
On his part, Suleiman blamed weak regulatory oversight and the absence of accessible mortgage systems for worsening rental conditions.
“Majorly, house rents are high because of a lack of control mechanisms and an inadequate or total absence of mortgages for ordinary Nigerians.
“You used to rent a self-contained property for N250,000 annuall,y and all of a sudden, the fees are raised to N1,000,000 with no value added to the property. This is the problem: there is no government control.
“Some agencies, lawyers or caretakers arbitrarily increase house rent without recourse to the harsh economic realities tenants face.
“Government regulators must wake up. Effective mortgages for tenants to transition into house owners must be in place. Enough of government inaction while Nigerians bleed.
Despite Nigeria’s inflation dropping to 15.10 per cent in January 2026, according to the National Bureau of Statistics, the cost of living for the majority of Nigerians has remained elevated.
