Efforts to expand homeownership through rent-to-own housing schemes in Nigeria are faltering due to outdated and inefficient foreclosure laws that make it difficult for developers to reclaim properties from defaulting occupants.
Although rent-to-own models are seen as a pathway to affordable housing—particularly for low- and middle-income earners—the lack of legal safeguards has made these schemes unattractive to developers and investors.
“The risk to developers is just too high,” said a real estate developer. “If a tenant stops paying and refuses to vacate, it can take years to recover the property. No investor wants to commit to that kind of uncertainty.”
In Nigeria, foreclosure remains a judicial process, often taking several years to complete. Legal experts say the process is marred by procedural delays, overlapping land regulations, and a lack of specialised courts. “The absence of a streamlined system for enforcing repossession rights is stalling innovation in housing finance,” noted a legal practitioner.
Unlike South Africa and Ghana—where non-judicial foreclosure options exist—Nigeria lacks the necessary legal infrastructure to swiftly resolve disputes. In South Africa, repossessions often take just three to six months. Ghana’s foreclosure reforms have also cut recovery timelines to under 180 days, boosting investor confidence and housing delivery.
By contrast, Nigeria’s timeline averages nearly three years, leaving developers exposed to prolonged litigation. “This undermines the financial model behind rent-to-own, which depends on predictable payment flows and enforceable contracts,” another housing expert explained.
Industry stakeholders argue that foreclosure reform is no longer optional. “If Nigeria wants to reduce its 28 million-unit housing deficit, it must prioritise legal changes,” said a real estate consultant. “Rent-to-own offers a bridge to homeownership, but that bridge is collapsing under legal uncertainty.”
Recommendations from experts include the creation of specialised foreclosure tribunals to fast-track property disputes, and legislative support for non-judicial foreclosure clauses in mortgage agreements.
“It’s time for the law to catch up with the realities of modern housing finance,” the consultant added. “With the right legal backing, rent-to-own could be the tool that transforms housing access for millions of Nigerians.”
