What new Lagos tenancy bill means for landlords, tenants and agents and why it matters

For months, the real estate sector in Lagos has been buzzing with talks of the Lagos State Tenancy and Recovery of Premises Bill 2025, introduced by the state government to modernise and reshape tenancy regulations in the state.

Like any major city, Lagos has been inundated with issues such as excessive advance rent, poorly regulated real estate dealings, and prolonged eviction dispute, problems the existing Tenancy Law enacted by the Lagos State House of Assembly in 2011 could not fully solve.

These issues have long posed a threat to the state’s status as one of the largest real estate markets in Africa, thanks to factors such as rapid urbanisation and population growth.

The bill, if passed, aims to overhaul landlord‑tenant relations in Lagos, introduce limits on advance rent, regulate real estate agents, provide tenants a legal path to challenge unfair rent increases, and streamline eviction and dispute resolution through faster court procedures and mediation.

Regulation of agents and 5% agency fee cap

Section 3 of the Tenancy Bill stipulates that all individuals acting as real estate agents must be formally registered with the Lagos State Real Estate Regulatory Authority (LASRERA). The law also places a cap on agency fees at five per cent of the annual rent. This ensures that agents cannot charge excessive commissions.

The law also provides that any money collected from tenants must be remitted to the landlord within seven working days and receipts must be properly issued to provide transparency. Violating these rules carries serious consequences including a fine of up to N1 million and imprisonment for a maximum of two years or both.

For years, Lagos tenants have faced problems with unregistered and unscrupulous agents. Cases of double-renting, inflated commission charges and outright scams are common, leaving renters vulnerable. In 2019, PREMIUM TIMES reported the case of a newly wedded couple who were swindled of N900,000 in Lagos by fake house agents.

The new regulation aims to bring accountability and professionalism to the real estate market, protect tenants from exploitation and clarify the responsibilities of legitimate agents.

“Any person who acts as an agent in contravention of subsection (1) and any agent who acts in contravention of subsections (2), (3) or (4) of this Section commits an offence and is liable on conviction to the repayment of the sums collected and imprisonment for a maximum term of two (2) years or a fine of One Million Naira (N1,000,000:00) or both,” the bill stated.

Limit on advance rent

This section of the bill tackled one of the fundamental problems Lagos residents have been grappling with, the two years upfront payments landlords often demand. Now, property owners cannot demand more than one year rent from new tenants. Sitting tenants who pay monthly, cannot be forced to pay more than three months in advance.

The bill further stipulates that tenants commit an offence if they offer more than these limits.

“Any person who receives or pays rent in excess of what is prescribed in this Section commits an offence and shall be liable on conviction to a fine of One Million Naira (N1,000,000.00) or to three (3) months’ imprisonment,” the bill stated.

Residents see this section as a game changer in the real estate sector as it has been the biggest pain point for many, as huge upfront rent is what has pushed many tenants into debt or worse still, homelessness.

The new law notwithstanding, market forces such as demand and supply as well as scarcity may weaken enforcement.

Ban on harassment and illegal eviction tactics

Section 10(a) and section 43 of the bill prohibits landlords from removing roofs, cut water supply, electricity, block access or seize a tenant’s property in an eviction process. Any attempt to forcibly evict a tenant without a court order is now a criminal offence.

The proposed bill is a response to widespread illegal or self-help eviction tactics by landlords in Lagos. Property owners have been known to break down doors, change locks of tenants or even use thugs to threaten tenants.

The bill prescribes a penalty of N1 million fine for defaulters or up to 6 months imprisonment.

Tenants can challenge unfair rent hikes

With the sky-rocketing cost of rent in Lagos, residents had hoped that the new tenancy law would regulate rent charges in the state. To the disappointment of many, the bill did not.

It however gave tenants the legal standing to block a rent increase they believe is unreasonable.

According to section 33 of the bill, the court will consider a number of factors such as the rent in similar neighbourhoods, evidence from both sides and special circumstances.

“In determining whether an increase in the rent is unreasonable, the Court shall issue hearing notice to the landlord and shall consider the application on the following grounds— (a) the general level of rents in the locality or a similar locality for comparative analysis; (b) evidence of witnesses of the parties; and (c) any special circumstances relating to the premises in question or any other relevant matter,” the bill stated.

Meanwhile, a landlord cannot eject the tenant while the case is ongoing. The section of this bill matters due to Lagos’ lack of rent control, as landlords can increase by 50 to 200 percent overnight. This new law gives tenants a legal shield they never had before.

Fast-track eviction/tenancy court procedures

Section 20 to 24 of the proposed tenancy bill stipulates that cases can now be filed by originating summons which makes proceedings faster. Also, hearings should be fixed within 14 days and the court may sit on weekends, public holidays and virtually. It further provides that mediation must not exceed 30 days.

The new regulation brings a sigh of relief to many tenants and landlords as the current eviction process is painfully slow, often dragging for years. The new law accelerates proceedings while still protecting tenants’ rights.

Furthermore, section 12 of the bill states that refundable security deposits must be transparent. Landlords must give tenants an account of how service charges and deposits are used, every six months. Also, security deposits must be refunded, except in cases of documented damages.

In addition, the bill, when passed into law, gives tenants explicit rights to privacy and peaceful enjoyment. Section 7 stipulates that tenants have freedom from disturbance, use of common areas and compensation for improvements made with written consent.

The Lagos State Tenancy and Recovery of Premises Bill was introduced in July 2025 passed its second reading on 10 July, and was then referred to the Committee on Housing for review. But as of late 2025, it remains a draft and has not yet become law.
(Premium Times)