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The Rent Act – “Maximum City” – Suketu Mehta

March 26th, 2012 · No Comments · Economics, Ideology, Policy, Progressive Politics

When World War II ended, another catastrophe struck Bombay in the form of the Bombay Rents, Hotel Rates, and lodging House Rates Control Act of 1947 – popularly known as the Rent Act. Bombay is still recovering from the legislative blast. Enacted in 1948, the act froze the rents on all buildings leased at the time at the 1940 levels. In the case of other buildings, the courts were empowered to affix a ‘standard rent’, which, once determined, could never be raised. The act also provided for the transfer of the right to lease the property at the fixed rents to the legal heirs of the tenant. As long as the tenant kepy paying the rent, he could not be evicted; he would not need to renew his lease. This was originally intended as an emergency wartime measure, a five-year provision to protect tenants from inflation and speculation after World War II. Bombay was full of troops early in the war. Accomodations were at a premium; Bombay was bustling. And the newcomers were rich; those who owned property in the city were not blind to this fact. So they hiked rents to whatever the market would bear. Outsiders who came in – Indians – found themselves frozen out of the city. The short-term visitors during the war were in danger of dispossessing the old-timers: thus the Rent Act.

Bu the act, once enacted, proved politically impossible to repeal, since there will always be more tenants than landlords. There are two and a half million tenants in Bombay, the most powerful political lobby in the city. All the political parties are unified in warlike support of the tenants; the Rent Act has been extended more than twenty times…

The Landlords can do nothing but refuse to repair their properties. So there’s no possibility of the housing stock of the island city improving or expanding any times soon, and more of the island city falls down every year. There are 20,000 buildings that are officially classified as dilapidated and need to be renovated by the public agencies; under 1,000 a year are actually improved.
The Greater Bombay region has an annual deficiet of 45,000 houses a year. The amoung to ne construction every year comes up to less than half the number needed. Thus these 45,000 households every year add to the ranks of the slums…

There are also 400,000 empty residences in the city, empty because the owners are afraid of losing them to tenants if they rent them out. Assuming each apartment can house a family of five people, on average, that’s two million people – on-quarter of the homeless – who could immediately find shelter if the laws were to be amended.

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