Spending Over 40% Of Income On Rent Is Too High — Hamzat

Lagos State Deputy Governor, Obafemi Hamzat, has advised workers not to spend more than 40 per cent of their income on rent.

He urged young employees to consider living with their parents, relatives or sharing accommodation while building their finances.

Hamzat spoke during a question-and-answer session with Nigeria Info FM, Lagos, while responding to concerns over rising rents and the difficulty low-income workers face in securing accommodation in the state.

He was asked how a 22-year-old earning N100,000 monthly could afford a self-contained apartment or mini-flat costing about N1m annually.

The deputy governor said young workers should choose accommodation based on their income rather than feel pressured to rent expensive apartments at the start of their careers.

“Don’t let us misunderstand ourselves as a people. We are cultural people. Do you understand? So, if I start work as a young person and I’m not married, a lot of us live with our parents. A lot of us live with our cousins,” Hamzat said.

He said young people should not feel compelled to rent self-contained apartments when their incomes could not support the cost.

Hamzat said housing costs must be balanced against other essential expenses, including food, clothing and transportation.

“In fact, if you spend more than 40 per cent of your income on rent, it is too high because you must eat, you must buy clothes, you must do transportation,” he said.

The deputy governor also spoke about the Lagos State Government’s mortgage financing scheme, saying residents could use mortgages to spread the cost of buying property over several years rather than paying the full amount at once.

“But, you know, the challenge is we cannot continue to buy houses the way we buy rice and yam. Do you understand? So, we must buy properties using a mortgage, and that’s why we have a mortgage board in Lagos,” Hamzat said.

According to him, the Lagos State Residents Registration Agency (LASRRA) number would help the government establish residents’ identity, address and place of work as part of the process of assessing their ability to access housing finance.

Hamzat cited a N7m property as an example, saying a prospective homeowner could pay a 10 per cent initial deposit of N700,000 and spread the remaining payment over 10 years.

He said monthly repayments could vary according to the buyer’s income, with some residents paying about N25,000 or N35,000 monthly.

“That is the way to go because we know that a lot of people will not be able to afford to pay a one-shot deal,” he said.

Hamzat urged young workers to start with accommodation they could afford and gradually work towards home ownership as their incomes and savings improved.

He, however, acknowledged that housing affordability was linked to the broader economic situation, saying residents needed better incomes and economic stability to cope with the rising cost of living.

“The cost of buying things is what we need to fix first, and then when we fix that, which is what the Federal Government is doing now, then we’ll be able to talk a lot more about other pillars that stop on top of that,” Hamzat said.