Commission Fees and Agreement Fees Explained in Nigeria

A commission fee is a one-off charge paid to a real estate agent for finding and facilitating a tenancy. In Lagos, the standard commission fee is 10% of one year's rent. For a flat renting at ₦1,200,000 per year, you would pay ₦120,000 in commission fees. In Abuja, rates often range from 5% to 10% depending on the agent.

Commission fees are legal under Nigerian property law, but the Lagos State Tenancy Law (2011) caps certain charges and prohibits agents from collecting fees before a tenancy agreement is signed. You should never pay an commission fee before inspecting the property and seeing a draft agreement.

On Flatmates Nigeria, commission fees only apply to long-let listings facilitated by verified estate agents. Peer-to-peer listings between private hosts and tenants do not carry commission fees.

An agreement fee covers the cost of drafting and reviewing the tenancy agreement. It is typically charged as a percentage of one year's rent - usually 5% to 10% - and is shared between the host and tenant, though in practice many Lagos hosts pass the full cost to the tenant.

The agreement fee pays for a solicitor to draw up a proper tenancy agreement compliant with the Lagos State Tenancy Law or, in Abuja, the FCT Tenancy Act. A legally sound agreement protects both parties and should clearly state the rent amount, duration, caution deposit, notice period, and maintenance responsibilities.

Always insist on receiving a copy of the tenancy agreement before paying any agreement fee. If an agent refuses, that is a red flag.

Beyond commission and agreement fees, most Nigerian tenancies require several upfront payments at signing:

• Rent in advance - typically 1 year, though some hosts accept 6 months in Abuja and Lagos
• Caution deposit - usually 1 to 3 months' rent equivalent
• Commission fee - 10% of annual rent where applicable
• Agreement fee - 5–10% of annual rent
• Agreement fee - a small flat charge (₦5,000–₦20,000) for notarisation in some states

For a one-bedroom flat in Lekki Phase 1 at ₦1,500,000 per year, you could be looking at total upfront costs of ₦2,100,000 to ₦2,400,000. Plan ahead and always confirm all fees in writing before committing.

The Lagos State Tenancy Law prohibits hosts and agents from demanding more than one year's rent in advance for annual tenancies. If you are asked to pay two or more years upfront, you can decline and cite the law. Violations can be reported to the Lagos State Rental Tribunal.

Always insist on official receipts for every payment. Flatmates Nigeria provides a digital payment trail for all transactions processed on our platform - if you pay outside the platform you lose this protection.

If an agent quotes fees significantly above the standard rates or refuses to provide documentation, report the listing using the 'Report this listing' button on the listing page.