TENANCY LAWS, MULTIPLE TAXATION AND RESIDENTIAL HOUSE RENTS IN LAGOS
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TENANCY LAWS, MULTIPLE TAXATION AND RESIDENTIAL HOUSE RENTS IN LAGOS
CHAPITRE ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Lagos State, known as Nigeria’s commercial centre, has the country’s most active and expensive rental market, with tenants in its highbrow neighbourhoods paying exorbitant rents for residential units, while equivalent apartments in low-mid income areas cost less. Apart from high demand and little supply,
additional factors contribute to the high rent, particularly the Lagos Tenancy Law and double taxation, according to Akinlade (2014), are driving up housing rents in Lagos.
Recognising that Lagos is home to over 21 million people and that housing is a key concern for the city, the state government implemented the Tenancy Law in August 2011, which mandates one year rent for a new tenant and six months for a sitting tenant.
According to Akinlade (2014), the single-year rent payment regulation has hindered investment in rental housing and pushed rent to new heights, with landlords currently collecting two years’ rent for one year in several areas of Lagos.
He went on to say that developers were forced to pay for land, planning and approval, the environment, council, and taxes through triple taxation. In Lagos, access to land through government allotment is a battlefield for moneybags. Planning permission takes long, despite the government’s claims of one to two months.
The Federal Government’s housing policies have not contributed enough for developers in that access to credit from banks has been nearly impossible for developers, and developers who are fortunate enough to receive loan offers must find over 150 percent security for the bank to hold; 25 percent interest rate on bank loans, which is a killer for any developer’s business plan (Collins, 2003).
Other reasons for the high rent include the sale of Federal Government land in Lagos, a high exchange rate to import building materials, highly priced local building materials, high fuel costs reflected in transportation and generator costs, high labour costs, and insufficient design to maximise land space.
Lagos has had a 30-year mass housing gap because there has been no mass housing for rent since Lateef Jakande’s rule from 1979 to 1983. Jakande was the state’s last governor to successfully implement and deliver mass housing initiatives for rent.
For the past 30 years, successive governments have ignored Lagos people’ needs. Jakande also commissioned a report on Nigeria’s housing shortfall, which was estimated at 16 million in 2010 and is expected to reach 20 million by 2020.
According to Affe (2008), it is fair to the citizens if the government fulfils its commitments to the people and provides citizens with meaningful lives. This is why the Lagos State Government implemented the Land Use Charge in order to generate cash for the maintenance and provision of new infrastructure. In light of this, the researcher is investigating the impact of tenancy law and various taxes of residential housing rent in Lagos State.
1.2 STATEMENT OF THE PROBLEM
Lagos State is gradually transforming into a multi-nuclei metropolis, giving rise to a slew of real estate submarkets. Nonetheless, residential housing rents have remained excessively expensive, particularly in areas traditionally seen as more lucrative, such as Ikoyi, Victoria Island, Lekki-axis, Ikeja, Apapa, Isale Eko, and Amuwo Odofin.
However, academics believe that the skyrocketing residential housing rent in Lagos State is the result of various causes, including the Lagos State government’s tenancy law and multiple taxation. The purpose of this research is to investigate the impact of tenancy law and multiple taxation on residential housing rent in Lagos State.
1.3 OBJECTIVES OF THE STUDY
The following are the study’s objectives:
1. To investigate the impact of tenancy legislation on residential dwelling rent in Lagos State.
2. To investigate the impact of numerous taxes on residential house rent in Lagos State.
3. To find additional factors that influence residential house rent in Lagos State.
1.4 RESEARCH QUESTIONS
1. How does the tenancy legislation affect residential dwelling rent in Lagos State?
2. How does multiple taxes affect residential house rent in Lagos State?
3. What factors influence residential dwelling rent in Lagos State?
1.5 HYPOTHESIS
In Lagos State, tenancy legislation and multiple taxation have little effect on residential house rent.
In Lagos State, tenancy legislation and various taxation have an impact on residential housing rent.
1.6 SIGNIFICANCE OF THE STUDY
The following are the study’s implications:
1. The study’s findings will inform the general public about how tenancy law and various taxation have affected residential dwelling rent in Lagos State. It will also serve as a roadmap for policymakers and the Lagos State government in resolving the issue of people or corporate entities paying two or more types of tax at the same time.
2. This research will also serve as a resource base for other academics and researchers interested in conducting additional research in this sector in the future, and if utilised will go so far as to provide new explanations for the topic.
1.7 SCOPE AND LIMITATIONS OF THE STUDY
This study will examine Lagos State’s tenancy law as well as all aspects of multiple taxes in order to determine their impact on residential house rent.
STUDY LIMITATIONS
Financial constraint- A lack of funds tends to restrict the researcher’s efficiency in locating relevant materials, literature, or information, as well as in the data collection procedure (internet, questionnaire, and interview).
Time constraint- The researcher will conduct this investigation alongside other academic activities. As a result, the amount of time spent on research will be reduced.
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