Rental Housing - UN-Habitat

In most developed countries, the vast majority of tenants occupy accommodationthat is subject to a formal contract and is covered by environmentaland safety controls. In many poorer countries, most rental business lies outsidethe law. In housing located in illegally developed settlements and even in somecentral city areas, few contracts are issued, the rental housing legislation ismostly ignored and few landlords pay income tax on their rental earnings.Where there is public housing it is often sublet illegally as in Mexico, Chile andKenya. 5 In Jamaica: “about one-third of [public] units are illegally sublet bythe original mortgagors”. 6Where formal rental contracts are issued, their nature can vary evenwithin the same country. In the Republic of Korea there seem to be at least fivekinds of rental agreement varying from renting by the day jjogbang to chonsei,the arrangement by which tenants put down a large sum of money at the beginningof a contract and are repaid, interest free, at the end. 7 Chonsei contracts inthe Republic of Korea, anticresis in Bolivia, girvi in Surat and bogey inBangalore all seem to involve tenants paying nothing in rent for a tenancy oftwo or three years but providing the landlord with an interest-free loan. 8 Suchan arrangement is popular with owners where prices are rising quickly or whenthey need access to capital. In Bangalore, bogey occurs for a number ofreasons:“to raise finance for house construction or improvement; to raisemoney for investment in an existing business; to use the moneyraised in more profitable activities. It is only commonly used in partsof Bangalore and by particular kinds of people”. 9In sum, rental housing takes a wide variety of forms. The precise form isdetermined according to national and local conditions and any sensible policytowards the sector must recognize that diversity.II.B. The public sectorAcross the globe, most governments have attempted to provide rental accommodationfor some section of the society at one time or another. Governmentshave housed some of their own employees, most often its armed forces. Publicservants have often been provided with rental accommodation, particularlywhen they have been asked to work in cities where there was little appropriateshelter. In Delhi, public rental housing accommodated 6 per cent of all householdsin the city and 13 per cent of all tenant households in 1981. 10 In Nigeria,the government offers cheap rental accommodation to most professionalemployees. 11 Parastatal organizations, like the Indian or Kenyan Railways,have also housed their workers. 12 Educational institutions such as universitieshave frequently provided accommodation for some of their students. BecauseChapter II: Nature of the rental housing stock 27