Rent Control or Slum Propagation?
Asia’s largest slum. Hmm.. How did that happen? Were the lawmakers of the city blind? Or did they simply choose to act blind. In this post I look at how the Rent Control Act is enhancing the growth of slums, and politicians, despite being fully aware of the consequences, are choosing to turn a blind eye to it.
Basically, the Rent Control Act says that once you have let out any property to a tenant, you cannot force that tenant to evacuate that property and you cannot also increase the rent once it’s been fixed. There is some history to consider here. Immediately after independence, there were a lot of apartments and chawls in Mumbai that were occupied by tenants. After this Act was passed, the tenants could not be evacuated. To this day, the tenants continue to live there. And, to top it off, the rents that they pay have been frozen at the rates they were 50 years ago. So, you have, in today’s world people who pay amounts like Rs 10 as monthly rents for real estate some of which might, in an open market, go for upto a 100,000 times that. Much of that housing isn’t in prime shape since the owners have no incentive to renovate and the tenants can’t afford to.
So, how does this Act affect Mumbai? The growth of any city is typically dependent on the rich/middle class building houses and letting it out to tenants. This is the case with most cities in our country. But since the Act has such unpleasant ramifications for the landlords that the people in the city just don’t want to give out property on rent. Hence, when young poor families come to the city in search of jobs etc, they are unable to find housing, since no one is willing to let them stay. What do they do? They go to the only place where they can get a roof over their heads. Slums.
This is a problem faced by not only would-be slum dwellers but anyone who comes to the city and tries to find rental accommodation. If you have ever tried to get a place on rent here and then in any other city, you know only too well which is easier.
Now, why isn’t this issue being resolved? Because it isn’t that simple. There are a lot of tenants who are protected by that Act and the revoking of it would simply render them helpless all of a sudden. Families who have been comfortably living in a neighbourhood for decades could suddenly be uprooted from their surroundings which they could not afford under normal market conditions and, understandably, they would be upset. No politician wants to alienate a large section of the population and stir up a hornet’s nest. On the other hand, the availability of rental housing could be a boon for the city and help reduce the alarming rate at which slums are growing. What I advocate is to revoke the law but protect the people who have been tenants for a long time (how long “long time” is must be decided”).
Complete inaction can never be the solution to any problem. Will there be dissenting voices? Yes. But is it also a fact that the rate of immigration into Mumbai is staggering by normal urban standards and does not seem to be reducing any time soon? Yes. Sometimes, politicians must take difficult choices for the good of the people that might not be universally popular. Do I see someone in politics who can act without bias and provide a viable solution to this problem? Unfortunately, a resounding no.
