Economic Downturn: Tough time for landlords, tenants

Landlords across the country are finding it difficult to net in rents on their property from tenants due to the economic downturn.

Property developers told the Daily Trust that times have been hard for both landlords and tenants since the 2016 economic recession. The situation worsened with the COVID-19 pandemic.

Thousands of workers lost their jobs while business owners lost their fortunes; heightening the cash crunch amid competing needs.

Findings by Daily Trust revealed that the situation has strained the relationship between the two parties, some leading to litigation.

Tenants, on the other hand, are deploying different methods to evade eviction.

In Abuja, tenants pay piecemeal

Abubakar Ahmad, a resident of Efab Estate in Abuja, said he had to struggle to pay his last rent after he lost his job during the lockdown.

He stated that in order not to get evicted from the house he stays, he struck an agreement with his landlord to pay his rent in instalments.

“I now use my car for ride-hailing-service till new fortune smiles on me. With my new status, if my situation does not change, I plan on moving from where I am now staying,” he said.

Emmanuel Okpe, another resident, urged landlords to be sympathetic with their tenants as those who are finding it hard to pay their rents were put into the positions by the dire economic state in the country.

“We are in a difficult period so landlords need to help their tenants in whatever way for them not to become homeless,” he said.

Also, some landlords interviewed said they would rather leave their houses empty as can be witnessed in most highbrow areas of Abuja.

Mr. James Ugoh, a landlord in Asokoro, said when tenants default payment of their rent and you take them to court, you don’t always get justice and even when the landlord sometimes gets justice, the case dragged on for a long time.

“I prefer to let my property to corporate organisations than individual tenants. That is why when I don’t get a corporate organisation to rent any of my properties, I prefer to leave it empty,” he said.

In Kaduna, landlords resort to dirty tricks, court

Landlords in Kaduna now resort to the rent tribunals to either recover their rent or their premises from defaulting tenants. They also use unconventional methods to force tenants to pay.

Kaduna branch manager of Jide Taiwo & Co Estate Surveyors and Valuers, Taiwo Ayebo, said they have had to come up with new ways and techniques to recover rent from defaulting tenants, in recent times.

While categorising tenants into two, he said, “There are those who are perpetual defaulters who are only using COVID-19 not to pay their rent, and there are those who did not default but for whatever reason, they owe for the first time in seven years and we understand with them.

“I have a very considerate landlord who asked us to check our records and give a rent deduction of 20 per cent to tenants who did not default before the pandemic. But out of 30 of my tenants, only seven qualified for the gesture,” he said.

He added that they were about to increase rent for some tenants who had been on the same rent for seven years but the landlord asked them to put that on hold due to the economic effect of the pandemic.

Ayebo also stressed that going to the rent tribunal is the last resort, adding, “We have various ways of getting our money; including the civilised and the cruel way.

“One of the ways is that I do not go to your house; I go to your office and when I get there, I sit in the reception and start making a scene; most people do not like embarrassment and it works.

“Someone was owing me rent for almost 10 months. She paid N200,000 out of N400,000. The day I sent my staff to her house, she paid N100,000 and completed the balance the following day because I asked my staff not to leave the house until she paid.”

Daily Trust also gathered that areas like Sabon Tasha, Narayi, Television and Kaduna North where low-income earners mostly reside are more prone to defaulting tenants.

Many properties unoccupied in Rivers

A landlord at Oyigbo, Port Harcourt, John Edochie, said he has about 10 blocks of flats that have been vacant for the past year.

He said he preferred to lock up the properties than renting them out to tenants that were not ready to pay.

A property owner in Eleme, Eleme Local Government Area of the state, Oluka Chuna, also said he stopped putting tenants in his house soon after he had issues with his last set of tenants.

“I have five blocks of flats which I rented out. For two years after the first tenancy expired, they stopped paying rent with flimsy excuses that they were out of job because of COVID-19. I tried to evict them but they tried using the courts to delay their exit from the house. I had to use force and that was when it dawned on them to pack out.

“I rather remain hungry than to bring in people that will occupy my properties without paying the rent,” he said.

Tenants struggling to pay backlog in Kano

A house owner, Ahmad Adnan, said for a year his tenants have been struggling to pay their previous bills rather than pay upfront as they usually did.

“The situation is so bad that even the last time they paid it was the previous bill, and it was not even complete payment. I just collected what was paid. There’s nothing one can do now than be patient and watch as events unfold.

“I have a shop that I charge N40,000 per annum on but for the past two years now, I have not been paid. It’s just one excuse or the other,” he said.

Nasiru Abu, a tenant said, “it is a very difficult situation we are in. I teach at a private school and you all know what happened last year as a result of the COVID-19 pandemic. I did not receive my salary for months and just managed to pay part of my outstanding house rent and pleaded with the landlord to give me time to settle my debt and pay ahead as usual,” he said.

Also, Alhaji Ibrahim Kaka Daudu, a private property owner who said he owns more than five houses across the state, revealed that in the past year, he received less than 50 per cent of his total annual rent.

In Borno, only court ejects defaulting tenants

A property owner at Pompomari, Malam Basiru, said the prices of rental houses rose ‘astronomically’ in Maiduguri due to the daily influx of displaced families and expatriates.

“The demand for homes and office accommodation rose in the past 10 years when insurgency started and that led to increases in rent. The situation was worsened because most skilled workers coming to Maiduguri newly have good tastes and hardly bargain with agents,” he said.

The development, he said gave rental homes’ agents the upper hand to raise prices.

“Many tenants are being forced to cope with the situation; bridegrooms mostly struggle to make initial payments through the nose and hardly earn enough money to make subsequent payments and renew the lease.

“Tenants who could not pay rent do not panic because the courts give them enough time, at least three months quit notice,” he said.

He said many agents and landlords were left to suffer losses by the ‘annoying habits’ of tenants who ‘intentionally’ damage homes and leave without repairing the damage.

A tenant who was evicted from a house at Federal Low-Cost estate said he was given a month’s quit notice because he could not source for money to “continue playing N150,000 annually for the small family house which consisted of a room, parlour, kitchen and toilet”.

How we’re intervening – Developers association

Reacting to the situation, the President, Real Estate Developers Association of Nigeria (REDAN), Dr Aliyu Wammako,  told Daily Trust yesterday that the COVID-19 pandemic and the economic downturn have created lots of problems for both tenants and landlords.

He said the development has created room for a lot of misgivings in the sector.

“It is very worrisome for these tenants not able to meet up with their rent obligation. School fees are there, prices of foodstuff are increasing by the day and the price of petrol has gone up – so many things are associated with this.

“Also, the landlord is struggling with how he can maintain his house and he needs money to maintain the house, most especially with the coming of another rainy season.

“That is why in REDAN, we call on our people and mortgage institutions to soft-pedal on the issue of repayment on mortgages at least for this period. We have also given some sort of percentages as leverage to people under the rent programme of mortgages,” the REDAN president said.

Legal expert wants tenancy law amended

In his reaction, an Abuja-based lawyer, Malachy Nwaekpe, called for the amendment of the Recovery of Premises Act of FCT, 1990 to reflect the current democratic reality of the country as a way of resolving some of the issues in landlord-tenant agreements.

He said the disputes are caused by the use of yearly rent receipts instead of a proper tenancy agreement. He said where the agreement is on yearly rent, any court can invoke sections 7 and 8 of the Recovery of Premises Act of FCT, which provides for six months notice.

Nwaekpe added that where a tenant is owing the landlord arrears, such a tenant is regarded under Tenancy-at-Will and can only be entitled to 7 days notice when the landlord wants to recover his premises. (Daily Trust)