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The Rental Agreement With Option to Purchase is a sophisticated legal instrument used in Nigerian property transactions where parties wish to combine a rental arrangement with a future purchase opportunity. This document is particularly relevant in situations where potential buyers want to occupy and evaluate a property before committing to purchase, or when they need time to arrange financing. It provides protection for both landlords and tenants while establishing clear parameters for the potential sale. The agreement must comply with Nigerian property law, particularly the Land Use Act, and includes specific provisions for rent payment, property maintenance, option exercise period, purchase price determination, and the process for obtaining necessary governmental approvals. This type of agreement is commonly used in both residential and commercial contexts, offering flexibility while ensuring legal compliance with Nigerian federal and state property regulations.

1. Parties: Identification of the landlord/seller and tenant/potential buyer, including full legal names, addresses, and contact details

2. Background: Context of the agreement, including property description and intention to create both a rental agreement and purchase option

3. Definitions: Key terms used throughout the agreement, including Property, Option Period, Purchase Price, Rent, etc.

4. Rental Terms: Details of the rental arrangement including rent amount, payment schedule, duration, and renewal terms

5. Property Use and Maintenance: Permitted use of property, maintenance responsibilities, and property condition requirements

6. Option to Purchase: Terms of the purchase option, including option price, exercise period, and mechanism for exercising the option

7. Purchase Price and Payment: Agreed purchase price, payment terms, and treatment of rental payments toward purchase

8. Exercise of Option: Process and requirements for exercising the purchase option, including notice requirements

9. Title and Transfer: Provisions regarding property title, transfer process, and compliance with Land Use Act requirements

10. Representations and Warranties: Statements of fact and assurances from both parties regarding the property and their capacity to enter the agreement

11. Default and Remedies: Consequences of default under either the rental or purchase option terms

12. Governing Law: Specification of Nigerian law as governing law and relevant jurisdiction

13. Notices: Methods and addresses for formal communications between parties

14. General Provisions: Standard contractual provisions including entire agreement, amendments, and severability