The Lagos State House of Assembly is poised to introduce a new law that could significantly ease the financial burden on residents by slashing tenancy agency fees by half. At a recent public hearing on a bill titled "A Bill for a Law to Regulate the Relationship Between Landlords and Tenants," the Assembly revealed its intention to reduce the maximum permissible agency or commission fee from 10% to 5% of the annual rent. This move is a direct response to what Speaker Mudashiru Obasa described as the "worrisome" and "unconscionable" activities of landlords and estate agents regarding service charges and excessive fees. 

The proposed legislation aims to provide a clear and fair framework for the relationship between landlords, tenants, and agents. According to the bill, any agent found collecting more than the 5% cap would be committing an offense, punishable by a fine of ₦1 million, a two-year prison sentence, or a full refund of the excess charges. The bill also addresses a wide range of other issues, including guidelines for tenancy agreements, rent payments, property maintenance, and a structured process for recovering premises. It seeks to curb unreasonable rent increases, protect tenants from arbitrary evictions, and introduce more efficient dispute resolution mechanisms, such as mediation and virtual court hearings.

This legislative effort is particularly timely given the growing housing crisis in Lagos. The Assembly noted that the state's housing deficit has risen to 3.4 million units in 2025, and over 70% of residents are renters, with many spending a significant portion of their income between 40% and 60% on rent. While the bill has been welcomed by many as a vital step towards creating a more stable and predictable housing market, some professional bodies, such as the Estate Surveyors and Valuers Registration Board of Nigeria, have voiced concerns that the 5% limit conflicts with existing professional charges. The bill has been sent to the House Committee on Housing for further review, to create a comprehensive law that balances the interests of all stakeholders and provides a lasting solution to the challenges in Lagos's real estate sector.