Out of control

August 23, 2013

House rent in Dhaka going up by about 15pc every year; owners arbitrary for lack of proper law, specific authority
Out of controlCapital Dhaka is home to some 150 million people. One study shows nearly 80 percent of them live in rented houses, and they do so, as it looks, at the mercy of the house owners. It hardly occurs to most owners that tenants too have some legal rights.
Tenants do have rights. Under the law that regulates house rent, owners cannot let their houses without written agreements; cannot take more than one month’s advance; and cannot increase rent before two years. But these are all in the book. In practice, these rules are violated by most, if not all, building owners as there is no designated body to implement the law.
This has been a boon for owners, a bane for tenants. Over the past 22 years, house rent in the city has gone up by about 15 percent on an average every year, far outpacing the tenants’ income, according to a recent study by the Consumer Association of Bangladesh (CAB).
Such an increase in house rent, coupled with high inflation, has cut deep into the pockets of middle and lower income people. The overall inflation stood at 7.68 percent in July. It was 10.62 percent in the 2012-13 fiscal year and 8.8 percent in the previous fiscal year.
It is as puzzling as it is ghostly that house owners hike the rent whenever they like and how much they like and the tenants have no say at all, says CAB President Quazi Faruque.
Under the House Rent Control Act, 1991, tenants can go to the court of rent controllers should they feel deprived of their rights. But about 90 percent of tenants are unaware of the law, and this lack of awareness is a perfect tool for the owners to exploit tenants, he adds.
The very few that know about the law choose rather to be exploited by their house owners than face the lengthy legal battle.
In the capital, there are five rent controllers, who are also senior assistant judges, to resolve disputes over rents. One controller says tenants are reluctant to go to court out of fear that the owners will evict them. In that case, too, tenants would have no say.
The rent controllers are somewhat powerless, at least until a case is brought to their courts. After the settlement of a case, it is for the rent controllers to ensure that their verdicts are implemented. But they cannot always do so as they have no manpower at their disposal.
Between January and May 2011, only 102 cases were filed in the courts of two rent controllers covering Mirpur, Mohammadpur, Dhanmondi, Hazaribagh, New Market, Tejgaon, Gulshan, Uttara and Cantonment. The number was 131 in 2010.
On different dates this year, 10 such cases have been settled in one court. Seven of the suits filed by the tenants against eviction notices were rejected as they did not have written agreements. The three others went against the owners, meaning the tenants can stay until their agreement period expires. During this time, the tenants will pay the monthly rent to the controller who will then hand it over to the owners.
Under the law, owners can increase house rents every two years only at a standard rate. The law does not fix this amount, but says the standard rate is one that is appropriate and reasonable for the area.
Under the Act, a standard rent hike will be fixed through negotiations between the owner and the tenant or by the rent controller in case of a dispute. If the rent is abnormally hiked, a landlord can be fined double the amount taken from the tenant.
The law says owners can take only one month’s rent in advance. Violation of this provision means they will have to pay double the money in fine.
This is hardly the case; in most cases owners take at least two months’ advance.
Sharmila Sarkar, for example, hired a small flat at Gopibagh five and a half years ago, paying one month’s advance. Soon after she moved in with her four-member family, the owner forced her to pay advance for two more months.
The owner also promised not to increase the rent before two years. But he broke that promise and has since been increasing the rent every six to seven months. Last time he increased the rent after one year.
“I will be evicted if I do not oblige,” she said, adding she did not enter into a written agreement as the owner was reluctant to do so.
For the owners, the reasons for increasing the rent are numerous. Every time there is a price hike or an announcement of a new pay scale there will be a hike in house rent.
“Why should there not be an increase in rent when service holders are earning more or when the prices of commodities go up? I don’t have any other income,” says the owner of a six-storey building in Mirpur.
The remedy? The CAB president, who owns a building in the capital and claims that he follows the Act, wants the government to amend the existing law and give charge of implementing it to a specific body such as the city corporation. Also, a petition seeking High Court directives for strict enforcement of the Act is awaiting verdict. The 2010 petition aims to stop house owners from arbitrarily increasing rents and taking more than a month’s advance.
If the HC accepts the petition, it might as well direct the government to form a commission to fix house rents considering the standards, amenities and locations of the buildings, said advocate Manzill Murshid, who filed the petition.
But until then, life for the tenants “will go on as it has always gone on — that is, badly”.

Courtesy of The Daly Star

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