Calfat Projects LTD

BREAKING NEWS!
The Lagos State Tenancy Law has been updated to better protect tenants and regulate landlord practices. Here are the key provisions:

1. Advance Rent Restrictions

Landlords are prohibited from demanding more than three (3) months' rent in advance from sitting tenants. Similarly, tenants are not allowed to pay more than three months' rent upfront. Violations can result in fines up to ₦100,000 or imprisonment for up to three months.

2. Mandatory Rent Receipts

Landlords must issue rent payment receipts to tenants, detailing the payment date, names of both parties, property location, amount paid, and the rental period covered. Failure to provide a receipt can lead to a ₦10,000 fine.

3. Tenancy Agreement Fee Cap

The Lagos State Government has reaffirmed that tenancy agreement fees should not exceed 10% of the annual rent. Landlords and agents charging above this limit are in violation of the law.

4. Notice Periods for Termination

In the absence of a written agreement, the law stipulates the following notice periods:

One week's notice for a weekly tenant

One month's notice for a monthly tenant

Three months' notice for a quarterly or half-yearly tenant

Six months' notice for a yearly tenant

If a monthly tenant is in arrears for three months, the landlord may seek possession through the courts.

5. Tenant Rights

Tenants are entitled to:

Reasonable privacy

Freedom from unreasonable disturbance

Exclusive possession of the premises

Use of common areas for lawful purposes

Additionally, tenants who make improvements with the landlord's written consent may claim compensation if the tenancy is terminated.

6. Dispute Resolution

Tenancy disputes can be addressed in either the High Court or Magistrates’ Court within the relevant jurisdiction.

7. Prohibition of Unlawful Evictions

Landlords must not evict tenants without following due legal process. Self-help evictions are prohibited and can result in legal penalties.

For further details or to report violations, tenants can contact the Lagos State Real Estate Regulatory Authority (LASRERA). The Lagos State Government's position is that the total charge for legal and agreement fees combined should not exceed 10% of the annual rent.

Example:

If the annual rent is ₦1,000,000:

Total charge for both legal and agreement fees together should be ₦100,000 or less.

This means legal = 5% and agreement = 5%, or any other breakdown, as long as the total does not exceed 10%.

Anything above this is considered illegal under the Lagos Tenancy Law.

If you need a formal reference or want to lodge a complaint, you can contact LASRERA (Lagos State Real Estate Regulatory Authority).

What is a Tenancy Agreement Fee:
It’s a charge imposed by landlords, agents, or solicitors for drafting, reviewing, or processing a rental contract

Legal Fee:
This is the fee paid to a lawyer for drafting and reviewing the tenancy agreement, often calculated as 10% of the total rent.

Agency Fee:
This fee is paid to the real estate agent who facilitated the rental, typically ranging from 10% to 20% of the total rent.

Caution Fee:
This is a refundable deposit, usually 10% of the rent, intended to cover any potential damages to the property during the tenancy.

Service Charge (Optional):
Some landlords or communities may also charge a service charge for security, cleaning, Water and electricity, which is not always fixed and can vary depending on the property.

Example:
If the annual rent is N200,000, the potential fees could look like this:

Legal Fee: N20,000 (10% of N200,000)
Agency Fee: N20,000 to N40,000 (10% to 20% of N200,000)

Caution Fee: N20,000 (10% of N200,000)
Total Initial Cost (excluding rent): N60,000 to N80,000