Rents drop near varsities’ campuses as students stay home
Following the uncertainty associated with reopening of tertiary institutions after four months closure, property owners in some areas close to universities have dropped their rents.
Most landlords lost one of their most steady sources of tenants – students after the universities closed abruptly and moved online to complete their teaching amid the coronavirus pandemic.
The property owners had ventured into student housing and adopted designs in many urban centres to rip the benefits of increasing students’ population in the country. With the COVID-19 unsettling the rental market, owners of such buildings have been feeling the pinch.
In towns such as Akoka, Nsukka, Owerri, Ibadan, Okigwe, Umudike and Awka, hosting popular public campuses, landlords have been expectant of students return while others in search of tenants reduced their rents to attract occupiers.
The Guardian learnt that some of the landlords are also offering generous concessions as they shift focus from students to other prospective tenants, especially workers. For instance, Akoka and its environs, which cater for students of University of Lagos, rents for self-contain flats that usually go for N350,000 are being offered for N300,000, while a two-bedroom flat dropped from N1,400,000 to N1,200,000.
Meanwhile, students who had already signed leases before universities went on forced holiday and shifted classes online were looking to sublet their accommodation before news broke last week that tertiary institutions may reopen this month.
In Ibadan and Owerri, where student accommodation accounts for 30 percent to 40 percent of the rental market, the availability of new hostel projects is dwindling due to already abundant supply of flats as private developers weigh the economic impact on the market.
Experts believe that the development is temporary and will be a short disruption pending the time, schools resume fully. According to an estate surveyor and valuer, Mr. Samson Agbato, “it is just an interaction of forces between demand and supply at play.”
Agbato, who agreed that the coronavirus pandemic has impacted on student housing, predicts a modest recovery. He predicts that design concepts in students’ hostel would change to accommodate health, safety and environment.
The former chairman, Royal Institution Chartered Surveyors (RICS), Nigeria group, Mr. Barin Epega, told The Guardian that the drop in rent is expected as the students undertake their e-learning from their homes.
However, he said that the demand for such houses would return, if the schools adopt their normal calendar and start studies. Epega noted that if the universities resume and switch to remote learning, the demand will go down and most of the property owners will be converting the buildings to accommodate workers.
The former Secretary, faculty housing, Nigerian Institution of Estate Surveyors and Vlauers (NIESV), Mr. Casmir Anyanwu, said: “It is expected for the housing market to react to economic and social dynamics.
“Owners of hostels and student accommodation are bound to suffer losses as a result of the Covid-19 pandemic as schools were closed early and students returned to their homes for safekeeping.”
According to Anyanwu, property owners who may have taken rents in advance may not lose much, rather such students who may have paid several months in advance may lose money due to the pandemic.
“Lowering rents to attract tenant is ideal in a period like this. This means that such tenants may not be student but workers seeking accommodation.
“This implies that students accommodation may be scarce when they resume. However, the void in student accommodations presently is bound to be short-lived,” he added.
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