Most governments encourage their citizens to buy their own homes, yet the numbers of households renting and sharing accommodation is rising in many cities. Few governments, however, have been encouraging landlords to create more and better quality accommodation for rent.

A report from the United Nations Human Settlements Programme (UN-HABITAT) describes the diverse forms that rental and shared housing takes and examines some of the misconceptions about these forms of occupancy.

Landlords are rarely as exploitative as they are usually portrayed. In poor cities, most live on the premises and have similar social and economic characteristics as their tenants. Poor landlords rent to poor tenants and more prosperous landlords generally rent to better-off tenants. In the self-help settlements of most poor cities, renting is a means by which poor landlords supplement their incomes while expanding the housing choices of poor tenants. Few contracts between landlords and tenants are formal and most rental agreements avoid government rules and regulations.

The problems of excessive rents, poor quality accommodation and the arbitrary eviction of tenants are exaggerated. Research shows that many of our ideas about renting are untrue. Specifically:

• every household does not wish to be a homeowner: homeownership is a created desire, a product of particular forms of economic production and government intervention
• supporting rental housing is not inequitable: experience in many countries shows that it is state encouragement of homeownership, not renting, that fuels social inequalities
• poor quality accommodation not be demolished: in an environment of general shortage, governments should seek to add to the housing stock rather than doing anything to reduce it and increase homelessness
• renting does not promote inner-city decay: rather, it provides homes for the poor people who need to work in central areas.

Too many governments in developing countries seek to learn from past experience in industrialised countries that idealise home ownership, when there are more helpful housing models available elsewhere. UN-HABITAT looks at efforts in a number of countries to rejuvenate inner cities. In South Africa, collaboration between private companies, a social housing foundation and the central government is beginning to produce social rental housing. Changes in rent control legislation in Colombia have tried to revive commercial investment in rental housing, and Brazil, Chile and Colombia have experimented with leasing schemes to give tenants the eventual option of buying their property.

The report suggests that until governments confront their preference for homeownership and stop giving tax breaks to subsidise the mortgages of middle class families, little can be done to develop more and better rental accommodation. They need to recognise that most people need rental accommodation at some point in their lives. Landlordism is not just a form of providing housing but also a way of generating work in construction and providing a supplementary income for many poor families.

Actions needed to improve current rental housing stock involve:

• facilitating investment in rental housing and encouraging self-help landlords to build for rent, sometimes through offering subsidies
• improving the quality of rental housing stock
• examining critically the advantages and disadvantages of rent control
• encouraging out-of-court methods of conciliation and arbitration to settle disagreements between tenants and landlords
• recognising that support for rental housing should be regarded as a complement to homeownership, not a form of competition.

Source(s):
‘Rental Housing: An essential option for the poor in developing countries’ by Alan Gilbert, United Nations Human Settlements Programme (UN-HABITAT), Nairobi, 2003 Full document.

Funded by: Governments of Belgium and Sweden

id21 Research Highlight: 6 June 2005

Further Information:
Alan Gilbert
Department of Geography
University College London
26 Bedford Way
London WC1H 0AP
UK

Tel: +44 (0)20 7679 5506
Fax: +44 (0)20 7679 7565
Contact the contributor: a.gilbert@geog.ucl.ac.uk

University College London, UK

Information Services Section
UN-HABITAT
PO Box 30030
Nairobi 00100
Kenya

Tel:   + 254 20 623120
Fax:   +254 20 623477
Contact the contributor: infohabitat@unhabitat.org

United Nations Human Settlements Programme

Other related links:
Room for manoeuvre: livelihoods and rental housing

In defence of landlords: getting rental housing onto the policy agenda

Can urban housing regulations be pro-poor?

UN-HABITAT publications on Rental Housing