The Lagos State House of Assembly has unveiled a new provision in its proposed Tenancy Bill aimed at slashing agency or commission fees on rental transactions from 10% to 5% of the annual rent.
This initiative, outlined in Section 3(4) of the bill, was disclosed during a one-day public hearing on Wednesday at the Assembly complex. The legislation, officially titled “A Bill for a Law to Regulate the Relationship Between Landlords and Tenants,” seeks to redefine rental practices across the state.
Speaker Mudashiru Obasa, represented by lawmaker Stephen Ogundipe, stressed that any property agent charging more than the stipulated 5% would face severe penalties — including mandatory refund, a fine of ₦1 million, or a two-year jail term.
According to Obasa, the rising complaints over landlords’ and agents’ handling of service charges have necessitated this reform. The bill provides a clear framework for tenancy agreements, rent collection, property upkeep, and lawful eviction processes.
He revealed that Lagos’ housing deficit has climbed 15% — from 2.95 million units in 2016 to an estimated 3.4 million units in 2025 — with more than 70% of residents renting their homes, often spending 40–60% of their income on rent.
House Committee on Housing Chairman, Olusegun Ege, described the public hearing as a vital step in gathering stakeholder perspectives to ensure progressive legislation. The bill, comprising four parts and 45 clauses, addresses tenancy rights, obligations, dispute resolution, and protection against arbitrary evictions.
It prioritises mediation over litigation, caps rent hikes, and introduces modern judicial measures such as virtual hearings, weekend proceedings, and electronic filings to speed up dispute resolution.
Housing Commissioner Moruf Akinderu-Fatai said the reforms would strengthen investor confidence, while Attorney-General Lawal Pedro projected faster resolution of tenancy disputes — ideally within six months — to prevent abuse of court processes.
However, professional bodies, including the Estate Surveyors and Valuers Registration Board of Nigeria, have expressed concerns over the 5% agency fee limit, calling for alignment with existing industry regulations.
The session drew government officials, legal experts, civil society groups, estate professionals, and community leaders, reflecting the wide economic and social implications of the proposed law.
