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POLICY REVIEW
Third, investment should instead any interest, effectively making rarely factored in policies and
be encouraged in rental housing the commuted rent equal to the regulations. Regulations for
units which cater to EWS and interest this amount would earn rental markets should factor in
LIG households, through in the owner’s bank account. their inputs and if required be
appropriate fiscal incentives In certain circumstances and formulated at city level.
such as tax holiday for an markets, the opportunity cost of Last but not the least, the biggest
initial period for owners and this lumpsum amount in terms challenge that needs to be
professional operators of rental of the potential bank yields surmounted is - the transparency,
housing as well as Real Estate foregone by the tenant is less security and standardisation
Investment Trusts (REITs). Also, than the market-determined from draft MTA need to be
rental housing models along the monthly rent that would have extended to all informal rental
lines of ‘rent to own’ projects otherwise been payable, making arrangements including those
such as ‘Chandigarh Small Flats the arrangement financially catering to the low-income
Scheme 2006’ for slum dwellers beneficial for both landlords segment to bring them into a
by the Chandigarh Housing and tenants. Such arrangements formal system so that necessary
Board should be explored across do not fit into the existing and suitable interventions can be
other cities. Beneficiaries of this framework of the MTA, yet are made.
scheme pay a monthly ‘license fully functional models that have
fee’ as rent for the allotted worked in the local context and CONCLUSION
flat. Although the schematics could be incorporated into the
for transition to eventual formal rental housing framework To conclude, as rental markets
ownership are yet not clear in of the country. Kumar (2003) in become more transparent,
case of Chandigarh, if properly the context of Bengaluru and efficient and secure for
implemented such schemes Surat, notes that it is impossible both landlords and tenants,
will be a welcome addition to for any institutional mechanism both demand and supply of
the stock of low-income rental to replicate the various rental rental housing will increase.
housing in a city. solutions and mechanisms Rental housing will play an
instrumental role in addressing
Fourth, the national rental policy which are in play, and suggests urban India’s housing gaps.
should encompass alternate non- that ways and means have Effective implementation of
conventional mechanisms of to be devised such that the ARHC and MTA, keeping the
rental housing that are prevalent government is able to support interest of urban low-income
in various parts of India. These and enhance the transparency households in mind, is the much
include arrangements where and efficiency of the rental needed next step.
the tenant, in exchange of a market in informal housing.
fixed lumpsum amount, gets Fifth, the MTA as and when
possession of the property adopted by the states should REFERENCES
during the period of tenancy, accommodate intra-city Asian Development Bank. (2013). India:
such as the Bhogya system in differences and needs across Promoting inclusive urban development
in Indian cities. India: Ministry of
Karnataka and the Othi system a state. While urban local Housing and Urban Poverty Alleviation
in Tamil Nadu . At the end of the governments are entrusted (MoHUPA). Available at: https://www.
period of tenancy the lumpsum with the role of ushering in adb.org/sites/default/files/project-
is returned by the owner without urban change, their inputs are document/81213/41609-012-tacr-03.pdf
[Accessed: 7 September 2020].
8 Based on authors experience and primary research
58 HUDCO-HSMI Publication
