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Date:March 17, 2019, 6:52 am

Unaffordable rent: Residents flee from Abuja city centreBy Mod - 4 minutes ago - [ Update ]


• Landlords, Property Owners Groan
• REDAN Wants Govt To Make Land More Affordable
As the economy gets harsher, workers in the public and private sectors resident in the Federal Capital Territory (FCT) are making their ways to adjoining states, where the cost of living is not as prohibitive as in the city centre.

Interestingly, the exodus is not only affecting residents of highbrow areas Abuja Area Municipal Council (AMAC) and parts of Gwagwalada, but also public and private sector workers residing in area councils of, Abaji, Kuje, Kwali, as well as Bwari.

And as the movement gets intense, villages and towns in neighbouring Nasarawa, Niger and Kogi states are becoming “choice destinations” for these relocating families, whose incomes can no longer sustain Abuja lifestyle, especially their accommodation needs.

This development has effectively returned several residential quarters houses, plazas and sundry structures to the property market, while landed properties are becoming very unattractive since neither tenants nor buyers can afford them anymore.

This much can be confirmed by a drive round the city and its suburbs, which reveals a high number of residential houses, plazas and large expanse of lands with small and large billboard, with inscriptions, “house for rent,” “plaza to rent,” “land for sale,” “plaza for sale” respectively.

The Guardian learnt that some occupiers who are yet to relocate are making plans to do so since they now find it difficult to meet their contractual obligations, a development that has resulted to litigations or outright cold war between tenants and landlords.

However, one of those that have successfully relocated is a retired Deputy Director, Ministry of Labour, Mr Omolola Joshua.He told The Guardian that he relocated from his Wuse home in Abuja to Suleja in Niger State as soon as he retired from service because there was no way he could sustain the payment of such high rent in the city centre as a retiree.

According to the Managing Director and Chief Executive of Favour Properties Limited, Abuja, Rotimi Adeniyi, at the root of the mass exodus of residents to adjoining states of the FCT is the economic hardship, which is being experienced in the country in recent years.

“We are mostly involved in the sales of houses, plots of land, as well as giving out houses and estates for rents to individuals and corporate entities. But what baffles us most is that following the nature of the economy; most of our businesses are at the lowest ebb. Not only that, many of our tenants have lost their jobs, and could hardly feed not to talk of paying their rents,” Adeniyi noted.

He added that many of his company’s property in Abuja city centre were presently empty as civil servants and other workers, who were hitherto occupying some of them have almost have vacated or are vacating.“Most of our tenants are presently relocating to areas like Madalla and Suleja in Niger State, Mararaba and Nyanya in Nassarawa States, as well as other towns and villages in Kogi State,” he said.

He said, most worrisome is the fact that tenants that are yet to relocate could hardly afford payment for the period they have used the facilities, stressing: “We have several cases involving our tenants in various courts in the FCT, and we are now making efforts to see how we can reduce rent to stop these relocations.”

Insisting that these are not the best of times for the property sector in the country, Adeniyi said, “we were collecting between N4m and N5m for three-bedroom apartment in the city centre, over N15m annually for duplex apartment, but people now find it easier to pay as between N250, 000 and N300, 000 for three-bedroom and N800, 000 for a duplex apartment outside the city.

“This is why you find several properties empty in the city. We are appealing to the Federal Government to create jobs, revive the economy in order to make life more meaningful for the people.”

But the Branch Manager of Jide Taiwo & Co, (a firm of estate surveyors & valuers), in Wuse, Abuja, Mr. Seye Aluko seems to have a contrary view as he insists that property were still very much occupied in the city centre, but noted that within the up-coming areas where plots are developed for mass housing, there were several houses that are unoccupied.

“We have a lot of competition amongst mass housing development companies who are looking for those that can pay for their houses. Remember that most estate development agencies raise their funds from the banks at exorbitant interest rates. So, these interests are transferred to buyers for the developers to remain in business.”

Aluko told The Guardian that one of the major reasons that people can no longer afford to pay rents in the city is loss of employment. “For example, a bank manager who was well paid in the past may not be able to retain his apartment once he is laid off from work. So, he immediately thinks of relocating from the city.”He explained that there are several cases of default between tenants and landlords across several courts in the territory.

Aluko further stressed that, “that real estate is capital intensive endeavour, and houses are put up for rent at very high costs because of the high cost of land in the city centre in comparison with what obtains in other areas. Once these houses are finally constructed in the city, they are bound to attract a whole lot of money as rent.”

For the situation to be corrected, he said that there is need for government to strengthen the mortgage system in order to meet the housings needs of the people.”The Chairman, Real Estate Developers Association of Nigeria (REDAN) FCT Chapter, Andy Elerewe says the high cost of land in the FCT is to blame for the prohibitive cost of rent in the area.

According to Elerewe, “A piece of land in FCT’s service areas Phase 1, 2, and 3, such as Utako, Maitama, Katamkpe extension, as well as Jabi District, goes for between N300m to N500m. This is why the rents are very high per annum. These land lords made it so in order for them to recoup their investments. Some of them even borrow money from banks at very high interest rates, and the only way that developers can get back their investment is by charging high rents.”

Elewere equally explained that it is because of the high rent in the city centre that residents that can ill afford such are migrating to “less expensive areas such as Suleja and Madalla in Niger State, and Maraba in Nasarawa State among other such places, where they can get comfortable accommodation for as cheap as N200, 000 to N255, 000 per flat.He called on the government to make land affordable for developers since it is public and private sector workers that would be the major beneficiaries in the final analysis.

Source:

guardian.ng/sunday-magazine/unaffordable-rent-residents-flee-from-abuja-city-centre/