End Of Road For Fraudulent Agents, Investors As Lagos Enacts Law To Regulate Real Estate

For real estate agents and investors whose mission in this sector is to defraud unsuspecting tenants and investors, end of the road is here as Lagos State government enacts a law to regulate transactions.

Known as Lagos State Real Estate Regulatory Authority (LASRERA) Law, the new law is aimed to regulate, sanitize and monitor activities in real estate market through LASRERA—a government agency under the state’s ministry of housing set up to regulate the sector.

Toke Benson-Awoyinka, Special Adviser to Governor Babajide Sanwo-Olu on Housing, explained that the LASRERA Bill was signed into Law by the governor because the state needed to ensure that global and professional best practice is entrenched in real estate business in the state.

Because land is scarce and there is housing demand-supply imbalance in Lagos, many estate agents and investors have been exploiting that gap to defraud prospective tenants and those looking for land to buy for investment purposes.

There have been cases of fraudulent agents who have collected rents from over 100 tenants for less than 20 units of apartments. There have also been instances of estate developers who have sold plots of land that don’t exist to buyers, especially to Nigerians in Diaspora.

But Benson-Awoyinka assures that the new law seeks to protect individuals from those fraudulent persons and organisations in the real estate sector in Lagos.

“The signing of the LASRERA Law means tenancy agreement below five years are now expected to be registered as transactions with the agency in order for us to have a data base of transactions, persons, and organisations in the real estate sector of the state,” he said.

Besides protecting home seekers, the new law will also boost financial transparency in the sale and purchase of properties, according to Benson-Awoyinka. She added that investors could now be prosecuted under the new law if fraudulent practices are discovered in their transactions.

“It is now an offence for an individual or organisation to engage in real estate business in Lagos State without being registered with our agency”, the Special Adviser said, urging real estate practitioners in the state to comply with the provisions of the new Law.

She hoped that the new law would contribute to ease of doing business in the state by curbing fraudulent and sharp practices as well as checking unregistered practitioners in the sector.

“It is our expectation that the new law will professionalise real estate practice; the minimum educational requirement for estate agency practice in the state now is West African School Certificate (WASC) in addition to certification from a professional agency which has power to organise stakeholder’s workshops/ training periodically for those in the sector,” she noted.

Benson-Awoyinka had, at a real estate event in Lagos, disclosed that this year was going to be different as the state government Lagos was going to tackle fraudulent activities in the real estate sector, stressing that “we will name and shame when the time comes because the returns on investment is unbelievable so there’s no reason to defraud people.’’

She advised individuals that want to buy land to do their due diligence and engage the services of a lawyer when purchasing properties to avoid cases of fraudulent land allocation.

The Special Adviser warned that there was no clear title of land in Lagos called ‘excision in process and so, land has not to be allocated to anybody that has such title. “You must search at the land bureau to ensure that a property has a clean title before you begin any transaction to avoid being scammed,’’ she advised land buyers.

She explained that it is the growth of the real estate sector and the proliferation of players in the state that has brought about the need to regulate and sanitize the sector.