By Amos Jolaoye SIR: In a bold move to ease the financial burden on renters, the Enugu State government has proposed capping house rent fees and abolishing the caution fee. This decision is expected to provide relief for tenants, especially in an era of economic hardship. However, beneath the surface, there are deeper implications, which could reshape the landlord-tenant relationship and affect how rental properties are managed.

For many tenants, the caution fee is just another expense in an already costly housing market. But for landlords, it serves as a safety net, ensuring that properties are returned in good condition. With its removal, we must ask: Will tenants be more careless with rental homes? Will landlords find new ways to protect their investments, possibly by making renting even harder?

Why was the caution fee introduced? At its core, when the caution fee was introduced, it was a simple but effective tool. Tenants paid it upfront, and if they took care of the house, they got the payment back when moving out. If there were damages beyond the ‘normal wear and tear’, landlords could use the fee for repairs instead of chasing down tenants, who had already left.

It also acted as an unspoken agreement, stating for instance: “Handle this house well and you won’t lose your money”. This development made many tenants become more mindful of their living spaces.

At first glance, scrapping the caution fee seems like a win for tenants, but the reality may not be so straightforward. Here’s why: 1. Less accountability, more damage

Without a financial stake in the property’s condition, some tenants may become less careful. After all, there’s no money to lose if they leave the house in poor shape. Small issues like leaking pipes, broken tiles, or wall stains could be ignored, leading to bigger damage over time.

2. Landlords will spend even more on repairs Even with the caution fee in place, many landlords already find that the amount collected isn’t enough to cover the full cost of damage when some tenants move out. In cases where tenants leave properties in terrible condition, landlords often have to spend much more than the caution fee to restore them. If the caution fee is removed entirely, landlords will have no immediate financial backup for repairs, making the situation even worse.

3. Landlords will find a way to protect themselves If Landlords can no longer collect caution fees, many may look for other ways to safeguard their properties. This could mean higher rent, stricter lease terms, or even making tenants pay for repairs before moving out. In the end, tenants might not actually be saving money.

4. More conflicts, more legal drama The caution fee helped settle disputes. If a tenant caused damage, the money was already available to fix it. Now, landlords might have to chase down former tenants for payment, leading to more legal battles and strained relationships.

5. Stricter tenant screening Landlords may become pickier about who they rent to. With no caution fee as backup, they could start demanding more rent upfront or favoring tenants with high-paying jobs. This could make it harder for lower-income renters to find housing.

The hidden benefits of keeping the caution fee Instead of scrapping the caution fee entirely, it might be worth considering ways to regulate it. Here’s why keeping it (with some improvements) could actually help tenants by encouraging careful living.

When people know they can get their caution fee back, they are more likely to take good care of the property. This benefits both tenants and landlords in the long run. It will also prevent sudden rent hikes. If landlords lose the caution fee, they might increase rent to cover potential damages. This could make renting even more expensive over time.

Gives tenants a clear exit plan With a caution fee in place, tenants know exactly what is expected of them before moving out. If they meet the conditions, they get their money back—simple and fair.

Reduces landlord-tenant disputes Having a security deposit system in place minimises arguments over damages, making the moving-out process smoother for everyone.

What’s the best solution? If the goal is to protect tenants from unfair charges, abolishing the caution fee entirely might not be the best move. Instead, the government could standardise caution fee amounts so that the landlords don’t overcharge.

Ensure strict refund policies to prevent landlords from unfairly withholding deposits. Introduce tenant insurance options as an alternative, where tenants pay small monthly fees to cover potential damages.

At the end of the day, housing policies should balance affordability with responsibility. While tenants deserve fair treatment, landlords also need protection to keep rental properties in good condition. A compromise that benefits both parties would be the true win for Enugu’s housing market and even Nigeria as a whole. • Amos Jolaoye is an estate surveyor and valuer based in Lagos.

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