Due to high rental values coupled with decline in purchasing power, new tenants and accommodation seekers now prefer small apartments to bigger types.
Also, due to the rush, a lot of landlords are currently converting their three and four bedroom flats to one and two bedroom apartments to get immediate occupancy.
Nigerian Tribune gathered that in the high-brow locations of Lagos and Abuja, investors and real estate developers are now taking the advantage of huge demand for studio apartments; one bedroom and two bedroom flats by low and middle income upcoming couples.
For tenants, it was discovered that their desire to cut cost and save money to meet other needs was driving their rush for smaller apartments.
Speaking, Jonathan Badmus, a landlord in Ajah, said he could not get tenants until he divided his three bedroom flat to two units of one bedroom apartment each.
Instead of the targeted N400,000 annual rent from the three bedroom flat, he said he had been able to rake in N500,000 as rent from the units of one bedroom flat.
According to him, the three-bedroom building had been emptied for more than six months before its conversion.
Another landlord narrated his experience, saying that rental values for one room apartment in Omole Phase I and II, Magodo, Maryland, Ogba, Ikeja, OPIC and Arepo in Ogun State now cost between N400,000 and N700,000.
According to a tenant in Ogba, who identified himself simply as Festus, a family of four, there was no need for paying high rent on big accommodation when his monthly salary is not big.
He said that one room and parlour, where he was paying N250,000 yearly as rent had eaten deep into his savings due to other competing needs.
A house seeker in Lekki, said that small apartments have become hot cakes in the environs as young couples, whose workplaces are within Victoria Island and Ikoyi jostle for few available accommodation.
He pointed out that huge demand for studio apartments, one bedroom and two bedroom flats in the property market against low supply was responsible for the rush.
In his last year report on ‘Real Estate Outlook, Managing Director, Northcourt Real Estate Limited, Mr Tayo Odunsi confirmed that studio apartments, one bedroom and two bedroom flats neared city centres would continue to enjoy demand and that there had been a shift by some developers in favour of these categories of apartments.
He pointed out that the rising demand for short let apartments would lead to more conversions, giving developers one more reason to shift focus from bigger houses to studio apartments.
“This would have the dual benefit of meeting the existing demand while maintaining cash flow for developers,” Odunsi said.
Lagos based estate surveyor, valuer and facilities management practitioner, Mr Stephen Jagun, noted that people have cut down on excessive space they occupied either as new tenants or old one, hence, the need for supply to follow the trend.
He said there were instances where people leased a room where they stayed during the work week days and traveled to meet their families at weekends.
“So if smaller accommodation is available directly in the market, they›ll take it; because the fellow you are paying rent to may not pay his own rent or the owner frowning at subleting,” he said.
According to Jagun, starters did not need all the luxuries, hence their preference for one bedroom and two bedroom flats.
Jagun added that expatriates, who are on short stay, also preferred studio apartments for their privacy and business.
This choice of apartment, the facility management expert said has provided another vista of opportunity for real estate developers.
An estate surveying practitioner, Mr Kunle Awolaja, attributed shrinking economy as main factor driving demand for small apartment
The trend for small apartments, Awolaja said might not necessarily reduce rent but would produce shift in accommodation types required, saying tenants would move from detached houses to smaller apartments.
Despite this, he said the shift in accommodation would not reduce nor solve housing problems as demand would increase for the smaller apartments which will result to the bigger apartments being redesigned and remodeled to the lower ones.
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