Why Delta State Government cannot stop high cost of rent in Asaba – Aniagwu

…Says, ‘We’re proud Asaba is growing faster than any other city’

Delta State Government has attributed the prevailing high cost of rent in Asaba, the state capital, to urban development and its ancillary results.

The government seems to be helpless in stopping landlords from charging outrageous amounts from tenants, but urged the aggrieved residents to see the good side of the development.

The government also urged the people to see the development of the city as an answered prayer.

“We are proud that our city is growing faster than any other city and you cannot be growing and expect that you are going to still pay the same rent you were paying in time past,” Charles Aniagwu, the state commissioner for works (rural) and public information, said.

BusinessDay’s checks revealed that a Two-Bedroom apartment has risen from N200,000 to about N600,000 and N800,000 annually for old houses, while those in newly built houses are between N1million and N2 million per annum.

In most cases, similar amounts go for a three-bedroom flat even as it is difficult to get a single-room or self-contained apartment in the state capital. This is despite the fact that there are other charges like Agent Fee, Legal Fee, and Caution Fee.

The situation has made it impossible for low income earners to afford accommodation in the state capital.

Small businesses also find it difficult in terms of shop rent as the types they used to go for N180,000 and N250,000 are now between N500,000 and N1,500 depending on the area – streets, plazas and major markets like Ogbo-Ogologo.

The trending pattern is that Landlords of old houses quit the occupants to make it possible for them to collect the prevailing rent. As the old tenants are forced to leave, renovation is done to attract new tenants.

While the high cost of rent has been largely blamed on the inflation and harsh economic realities in the country, some people blame it on the activities of Yahoo-Yahoo Boys and greedy/shylock landlords and their agents.

Some tenants in a part of Asaba had recently dragged Landlord Association in their area to court, challenging what they called unreasonable increase in their house rents.

The high cost of rent has badly increased cost of living which has negatively impacted the living standard of the average citizens. The situation is now pushing affected citizens to relocate out of the city or continuously borrow to pay house/shop rents while other basic needs are given zero attention.

The residents of the state want the state government to intervene by giving executive order on the issue of high cost of rent in the city.

State Government’s response:

Aniagwu, the state government’s mouthpiece, responding to a question at a press briefing, recently, said, “I keep saying it. You don’t go into a rotten mouth and begin to look for a healthy teeth because when the mouth is rotten, it is expected that the content and the teeth living in that environment will also be affected.

“You asked for development in Asaba. Development has what we call ancillary results that would come with it. We are proud that our city is growing faster than any other city. So, you cannot be growing and expect that you are going to still pay the money you were paying in historic time.

“When you are enjoying modern equipment, you want to pay primordial rent. It is not going to happen, because the development of the state capital, the influx of people on account of peace and other efforts of the government is largely at a very geometrical ratio while the issue of accommodation and other things are moving at arithmetic progression. And so, you see that imbalance between supply and demand.

“I’m sure as a student of economics, you should know that when supply outweighs demand, the forces of demand and supply would set in, in which case, you have many more people chasing the fewer accommodation; and that gives no room for people.

Aniagwu further noted that it is not just issue of rent in terms of houses but also the issue of buying and selling of land as land prices have also increased astronomically with the owners smiling to bank.

“Those plots of land you have before, you increase it (the price). From N1 million, you are selling it for N25 million. You are happy; and you think that the man who bought that land for N25 million would be happy to come and charge you rent from a land that is bought for N1 million. You know it is not going to happen. That is forces of demand and supply.”

What we are doing to address high cost of rent – Aniagwu

“What we are doing is to open up other frontiers, other corridors. Across the 25 Local Government Areas, we have started a programme, even if we are starting with three LGAs first, it is pilot programme where we are going to have 50 houses to cater for the need of primarily the civil servants.

“At the moment, we are building in three LGAs, a pilot and that is 30 three-bedroom flats and then, 20 two-bedroom flats.

“You may want to say is it just 50? Don’t forget that whence you build a two-bedroom fat, you are not just building it for one individual. That individual moves in with his family. That may be up to four or five persons who would live there. So, you know what that means.

“Again, that opens up that corridor where that building is situated, in addition to the jobs it created for those in the construction sector.

“Our desire is to see how we can escalate it across the 25 LGAs of the state. We are starting from Ika North-East. We have somewhere in Ozoro and another one in Kwale. These are three areas where we have started a pilot scheme and they are making a whole lot of progress in terms of construction.

“Now, you have also seen that we want to open up the Ugbolu axis, and we are building some roads so that those who also want to build can take advantage of the accessibility.

So, some of the roads we are opening up in some other areas is to expand the frontiers of development so that development is not clogged within a certain restricted, geographical entity.

“Because when you are restricted to a very small area, the issue of struggling to have a space will invariably trigger some form of demand push inflation. So, once you open up a corridor and people have the opportunity of being able to build and move in.

“For instance, you could see a number of people that have built in Okpanam area, who before now wanted to remain inside Asaba.

You also see now that towards Isselle-Azagba, people are now building beautiful houses there because they can now access those plots of land.

“So, those extensions help to reduce the demand and challenges that come with it. Therefore, our expansion of liveable areas also helps to fight this issue of high cost of rent.

“By the time you do that, you are able to tackle the challenge that happens when demand is far in excess of supply. So, those are some of the things we are doing,” he said.

It would also be recalled that Ifeanyi Okowa, the immediate past governor of the state, had maintained that the state had no power to intervene on issue of high cost of rents.

He was however, of the opinion that the landlords should not make their rent to be so outrageous that people would start packing out and never care for such apartments.

Conclusion:

Residents of Asaba, Delta State Capital, have endlessly looked up to the state government to address the way the landlords fix prices on their rent but from the response of the state, it is an impossibility.

Residents, especially civil servants who have no house of their own are expected to hope on the state’s housing programme the pilot scheme of which has commenced in three LGAs and would extend to the rest of the LGAs in the state.