How to Write a Rent Increase Letter in Nigeria

When you can actually raise the rent

At renewal. Not in the middle of a term. A tenancy is a contract for a fixed rent over a fixed period, and you cannot change one of its terms halfway through because costs have moved.

The exception is where the tenancy agreement itself provides for a review, which is what a rent escalation clause is for. If the agreement says rent increases by a set percentage at renewal, you are applying an agreed mechanism rather than proposing a new figure, and the conversation is much shorter. We covered how to write that clause separately.

Where there is no clause, the increase is a proposal. The tenant can accept it, negotiate, or decline and leave at the end of the term. That is worth remembering before you write, because the tone of the letter should match what it actually is.

How much notice to give

There is no single statutory notice period for a rent increase the way there is for ending a tenancy. What the letter has to do is reach the tenant early enough for them to make a decision before the current term runs out.

Three months before renewal is a sensible working minimum for a yearly residential tenancy, and more is better. Nigerian tenants usually pay a year in advance, so you are asking someone to find a large sum of money. Six weeks notice on a fifteen per cent increase is how a good tenant becomes a vacancy.

If the tenant declines and you end up needing possession, that is a separate process with its own statutory notice periods, and those are not shortened by having sent a rent increase letter. Check the notice period for the tenancy type before you assume the timeline works.

• Three months before renewal is the working minimum for a yearly tenancy
• Send it in writing, never by phone call alone
• Give the tenant a date by which to respond
• Do not assume an increase letter doubles as a notice to quit, it does not
• If possession may be needed, check the notice period for that separately

What the letter has to contain

Keep it short and specific. The tenant should be able to read it once and know exactly what is being asked and by when. Vagueness is what produces the follow-up phone calls.

State the current rent as well as the new one. Landlords often leave it out, and it makes the increase look larger than it is because the tenant is doing the comparison from memory.

• The tenant's name and the address of the premises
• The current rent, stated in figures
• The new rent, stated in figures
• The date the new rent takes effect, normally the renewal date
• The clause in the agreement authorising the review, if there is one
• A date by which you would like a response
• The date of the letter and your signature, with your capacity if you are an agent

Wording you can adapt

This is a straightforward version for a yearly residential tenancy. Adjust it for your situation, and have your lawyer look at it if the tenancy is commercial or the relationship is already strained.

Dear [Tenant's name], RE: RENT REVIEW, [address of the premises]. I write regarding the tenancy of the above premises, which expires on [expiry date]. The current annual rent is [current rent in figures]. With effect from [effective date], the annual rent for the premises will be [new rent in figures]. [Where applicable: This review is made under clause [number] of the tenancy agreement dated [date].] I would be grateful if you would confirm by [response date] whether you intend to renew on these terms. Please do not hesitate to contact me if you would like to discuss it. Yours sincerely, [Name, and capacity if signing as agent].

Notice what the letter does not do. It does not explain diesel prices, it does not apologise, and it does not threaten. A rent review letter that argues its own case invites a negotiation about the case rather than the number.

Do the arithmetic before you commit to a figure

Work out what the increase is worth against what a vacancy costs. Take a unit at N2.5m a year. A fifteen per cent increase is N375,000. If the tenant leaves over it and the unit sits empty for two months, that is roughly N416,000 in lost rent, plus an agency fee of about N287,000 to re-let at the new figure. You have spent around N703,000 to gain N375,000, before any repainting.

That is not an argument for never raising rent. Holding rent flat for years while inflation runs is its own loss, and it is the more common mistake among small Nigerian landlords. It is an argument for knowing which tenants pay on time and which ones cost you in chasing, because that is what tells you whose renewal is worth protecting.

If you cannot answer that question about a given tenant in under a minute, the problem is not the rent letter. It is that the payment history lives somewhere you cannot read it.

When the tenant pushes back

Most pushback is either a request for time or a request for a smaller number. Both are usually worth entertaining if the tenant has a clean payment record, and you can offer a staged increase over two renewals rather than one jump.

Where the tenant simply refuses and stays past the end of the term without agreeing new terms, you are into different territory: the tenancy has ended, the occupier is holding over, and what accrues is mesne profits rather than rent. That is a change in your legal position, not just an annoyance, and we covered it in detail separately.

One practical warning. Applying a different increase to different tenants in the same building, with no basis you could explain out loud, is how landlords end up in disputes they did not need. Set the policy, apply it consistently, and keep the record of what you sent to whom.

• Check the payment record before deciding how firm to be
• A staged increase over two renewals often lands better than one jump
• Put any agreed variation in writing and keep it with the tenancy
• Apply the same review timetable across the building
• If they stay without agreeing, get advice, the position changes

How Ledge handles rent reviews

Ledge works out the new rent from the current figure on a percentage or a flat basis, so the number in the letter comes from the tenancy record rather than from mental arithmetic at a keyboard.

It counts the lead time and warns you when a review is going out too close to the renewal date, which is the most common reason an increase gets resisted. It also flags a review that would take effect mid-term, because that is nearly always a mistake rather than an intention.

The rent history sits next to the payment history, so when a tenant asks why the rent is going up, you can show what they have paid, when, and what the rent has been across the tenancy. That is a better conversation than one built on two people's memories.

• New rent computed on a percentage or flat basis from the current figure
• Lead time counted automatically, with a warning when notice is short
• Mid-term reviews flagged before the letter goes out
• The review letter generated with the figures already filled in
• Rent history and payment history on the same tenancy record