Landlord and Tenant Profiles and Informal Rental Arrangements

Given the number of people who rent informal housing, its marginalization in policies and projects is concerning. It is estimated that, number of renters will soon out number the private owners in many slums of developing countries. Informal settlements cater to such needs and it is estimated that 60% to 90% of affordable rental stocks in Asia is available in informal settlements. 25% of housing stock in India comes from the informal rentals in settlements. With this alarming increase, the informal rental sector continues to be an understudied area. This study was conceived to further the knowledge about the informal rental markets. The research aims to understand how socio-economic characteristics of the landlords and tenants affect the rental arrangements, present in the same settlement. Authors like Kumar (2001), Gilbert (2016) claim that informal rentals offer the tenant with housing at an affordable price with flexibility to live and proximity to livelihood opportunities. These are perceived as the positive attributes of the sector. However, Gulyani (2008), Desai (2013) and Chattraj (2015) question these same attributes shaping the theory debate surrounding the rental market. The research seeks to understand the inclusion and exclusionary tendencies of the rental market based on the socio-economic profiles of the landlords and tenants. This research employed case study method as the research strategy with qualitative analysis. For which, semi-structured interviews were conducted. These interviews covered tenants, landlords and brokers in the informal settlement. Hence, the first step was to note the types of rental arrangements and types of landlords and tenants. The next step, was to draw out links between the rental arrangements and the types of landlords and tenants. Further steps included, interpreting qualitatively the strength of the relationship between these variables. It is clear from the findings, that the rental arrangements are varying and certain characteristics of the tenants and landlords are contributing for the change. The family structure of the tenants and the type of landlords influence the rental arrangement chosen. Furthermore, these alterations are more biased towards the landlords, leaving most tenants on the weaker side of the bargain and not always offering flexibility to tenants. Moreover, the rental arrangements can be linked with the domestic strategies of financial management opted by both the actors. The research leaves us with further questions, which are relevant to housing policy and further the knowledge of informal markets in developing economies.