One salient issue that begs for solution is how to regulate the activities of "Real Estate Agents" in Nigeria. Right now it is an all-comers affair, just get an office (some don't bother having one), know a couple of landlords and you are good to go. There are rampart cases of these folks absconding with people's money and nowhere to trace them. This brings me to the issue of 'agency fee' which these guys charge their clients. How do you rationalise a situation where one pays say, N150,000 as house rent per annum on a new apartment and pays extra N60,000 to an 'agent' in the name of 'agency fee'? How can one justify an 'estate agent' charging upwards of 10% of the total cost of buying a property bearing in mind that these guys seldom incur any expenses in that process. They insist on collecting 10% 'agency fee' just for linking a buyer and a seller. Envision where somebody buys a property worth say N100 million naira and an agent insists on being paid 10% which amounts to N10 million! The buyer will also probably fork out another 5-10% as legal fees in addition to other sundry charges. Before you say bingo, the total cost of that real estate will shoot up by 20-30%.
Estate agents are not alone on this. I remember unwittingly invoking the anger of a potential landlord when I politely enquired why he is asking me to pay an 'agency fee' even when I got the apartment directly from him. My logic fell on deaf ears as the man insisted I must pay him "agency fee", "agreement fee", "commission", "damages". I think this attitude is more pronounced in the Lagos axis. I can still vividly recall superintending over my father's couple of properties in the South East and I can't remember us charging prospective tenants all these fees.
Regulating this industry will bring some sanity because some of these guys make the work look like touting, exploitation or a career for lazy folks. Yes, there are professionals in their fold, this tirade is directed at the quacks amongst them. If you have encountered the quacks in their midst, they can be a nuisance.
Prospective tenants must resist an attempt by 'estate agents' to extort them especially when buying a property. Property buyers should try to negotiate a reasonable fee to pay an ageny. The reasonable ones will Listen to reason.
At the risk of heckling, I have consistently advocated that it will do a lot of good if Nigeria's National Assembly will rise to the ocassion by enacting a nationwide tenancy law that also regulates the activities of 'estate agents' in Nigeria. The Nigerian government, at federal or state levels should impress on the "Institute of Estate Agents of Nigeria" to rein in their members and sanitize the industry.
Content from Nigeria Property Centre
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