Financial costs of renting versus owning apartments in Nigeria: influencing factors to note

COST OF RENTED HOUSES IN NIGERIA

Some factors influence the cost of renting residential apartments in Nigeria. Such factors include location, available amenities, and the type of house to be rented. I will attempt to classify the rented apartments based on the type of construction and the aforementioned factors.

The hunt for a rented apartment depends on the financial capability of the individual, the proximity to his or her workplace, the comfort desired, etc. The easiest way to get apartments in Nigeria is through "estate agents" or, in more simple terms, "house agents". They usually charge a non-refundable fee range of N2000 to N15,000 ($2.7–$20) to help find a suitable apartment. Paying an agent is no guarantee that an apartment will be secured; hence, it is easy to fall victim to those preying agents who collect tokens in the name of helping to search for an apartment. This aforementioned cost is usually excluded from the agent's fee, which is usually charged when the apartment is eventually secured.

Eventually, there is the rent fee, the lawyer’s fee, the agent’s fee, and the caution fee. These fees usually vary, as some of them are overlooked. The agent's and lawyer’s fees are usually 10% of the rent fee, which is charged independently; however, the minimum an agent or lawyer would take is N10,000 ($13.3) irrespective of the cost of the rent once it is a self-contained apartment and above.

It was interesting to check out some of these apartments, even though I did not gain access so as not to be seen as an invader.

Below is the range of prices for different apartments.

SINGLE ROOMS: The range is between N30, 000 and N50, 000 ($40–$67) per annum, with an average cost of N2000 to N4000 ($2.7–$5.3) per month.

SELF-CONTAINED ROOMS: The range is between N70,000 and N200,000 ($93 and $267) per annum.

ROOM AND PARLOUR: The range is between N120,000 and N250,000 ($160–$333) per annum.

TWO/THREE BEDROOM APARTMENTS: The range is between N200,000 and N600,000 ($333–$800) per annum.
The above range of costs may or may not include the agent’s, lawyer's, or caution fees. The fees may include payments for electricity, but this is rarely the case. Houses are hardly ever taxed; however, if there is a need for such, the landlord takes such responsibility.

SINGLE ROOMS
Single rooms are, as the name implies, single. This means the space reserved for the tenant does not exceed the four walls of the room. Here in Nigeria, single rooms are usually built for very low-income earners, and there are usually many in a building. There could be about six rooms or more in a building, with a central convenience (meaning the tenants will have to share a common toilet and bathroom, which most times are unclean or locally made) and kitchen. The houses are usually not gated or fenced, and the landlord may co-habit in the same building. The source of water is usually a well, or the tenants may need to fetch water from the neighborhood. The building is commonly closed at night once the last person is assumed to have entered the house. It is not uncommon to have verbal or physical aggression. The room sizes could be small or moderate, but rarely big. This sort of apartment is common among students.

A ROOM SELF-CONTAINED
This type of apartment is usually more convenient to live in, though it is more expensive than a single room. It usually has an attached kitchen and toilet facilities, and the tenant does not have to share them. That is the reason it is referred to as a self-contained. The size of the room can range from small to large. There are usually fewer interactions between neighbors. A few disturbances in noise could emanate from the use of generator sets. This type of apartment is affordable for moderate-income earners and is common among students. There is usually an available source of water, such as a well with a water pumping machine or a borehole.

A ROOM AND A PARLOUR
This is superior to a room that is self-contained and is usually rented by undergraduates and postgraduates. A nuclear family could also be seen to take such apartments. There is usually a good water source, and the apartment may be fenced and gated. The apartment has space to accommodate loads such as furniture and electrical gadgets.

TWO/THREE BEDROOM APARTMENTS
These are usually for families or those intending to settle down. They are usually fenced or gated, and most often, electricity bills are taken care of by tenants per month or as often as needed where there is a meter attached to the house. These types of apartments could be flats, bungalows, or duplexes. Usually, the number of apartments in the compound ranges from two to eight, and oftentimes, there is less need for altercations among tenants. The landlord may be a co-inhabitant of the compound. Such houses can have a security post.

TO OWN AN APARTMENT?
That may sound like a luxury here in Nigeria for the average civil servant; however, houses have been built at a modest cost, and you can see artisans owning houses. Building a house may be expensive if the materials you are using are of high quality and you choose to secure your plot of land within the city. A plot of land in the urban area I live in costs between N5,000,000 and N7,500,000 ($6,667–$10,000), and you would need a range of N5,000,000–N15,000,000 ($6,667–$20,000) to build the house. This is not an assurance that the budget will complete the building, especially if you have a taste for aesthetics. Some landlords could choose to engage in local molding of blocks rather than purchasing those blocks from cement block-making machines. Personally, I do not mind using the local blocks to fence my land. The local blocks can also be enriched with adequate cement to ensure quality is preserved. Hence, commonly, people live in rented apartments and secure plots of land at the extremes of town, which are usually cheaper. A plot of land at the extreme end of Ilorin could go for as little as N600,000 ($800). Most low- to average-income earners do engage in loans from cooperative societies to be able to build houses of their choice.

SECURING AN APARTMENT?
I have recently devised a less cumbersome means of securing an apartment to rent. Agents and landlords have taken to social media, and one can get a fair idea of what the apartment looks like. A mobile app, Jiji has been very helpful as I get to see houses for rent in my locality. A good number of details are usually provided, such as the type of apartment, the location, the cost, the features, etc. I usually refer to this as "online window-shopping," where I can get an idea of what I am searching for while in the comfort of my home.

This, however, does not cut the agent’s fee on the house unless you know the landlord personally. The landlord may refer an intending occupant to the agent so that paper documentation can be obtained.

In any apartment I am looking out for, I am going to consider its proximity to my work place, the availability of electricity and water, and a less crowded environment which has little or no history of robbery attacks.

Currently, the rented apartment I reside in is in a serene environment that is less than ten minutes’ drive to work, and it’s a good place for anyone seeking a noiseless environment to stay.

Thank you for reading. I would love to have your comments and contributions.

ALL IMAGES ARE MINE

To participate, see the post Thank you, @tergan

H2
H3
H4
3 columns
2 columns
1 column
25 Comments
Ecency