Outside Delhi, informal rentals provide affordable housing

Mukta Naik, Delhi Community Manager
Delhi, 25 November 2015

Gurgaon, which lies on the southern edge of Delhi within the National Capital Region, rudely breaks the stereotype of the fringe urban space, one that is generally understood to be less than prosperous and highly aspirational. Instead, for the past two decades Gurgaon has been a magnet for global capital. Its population grew by 74% in the period 2011- 2011, almost entirely fuelled by internal migration.

The glass-clad high-rise office buildings and condominiums of Gurgaon, which symbolize wealth and power, hide the city's ugly underbelly. While the Census reports Gurgaon district to have 1.5 million residents, NGO Agrasar estimates that a million undocumented migrants from the poorest states in India work here in vital industrial and service sector jobs. These migrant workers live in crowded accommodation in underserviced areas of the city, invisible and "between the cracks" in glitzy Gurgaon.

These glaring inequalities exist despite the availability of capital that could have fixed the city’s growing pains. In fact, profit from private sector real estate development spurred Gurgaon’s growth, and the city was shaped by what anthropologist Shubhra Gururani calls "flexible planning" that "accommodated the desires of the wealthy and political elites."

While private developers acquired and developed agricultural lands into A-grade commercial space and high-end residences, the housing needs of the city's working class were ignored by the formal sector entirely. Private landlords in Gurgaon's urban villages and unauthorized colonies have filled this vital gap by building and renting tenements and huts as low-income housing for migrant workers.

Multiple typologies of informal rentals exist in Gurgaon, with rentals ranging from as low as INR 800 to as high as INR 6,500 per month. Local politicians have colluded with the authorities to allow the creation of slums on undeveloped or untenable lands, where the poor pay rent to live in shacks. Many landlords have rented out additions to their own homes. Others have built multi-storied tenements on land they own. Courtyard-style rental housing where services are located in common areas are commonly seen inside abaadi areas of Gurgaon’s urban villages.

This informal rental market is inherently flexible and well equipped to cater to the shifting demands of a migrant worker population that serves a growing city. Tenants can vacate at very short notice, allowing them to downgrade and upgrade housing as their socio-economic circumstances change. Plus, they can easily relocate within the city to move closer to jobs. The landlord, often characterized as the exploiter, is also a benefactor for migrants seeking connections in the city.

Sadly, informal rentals in Gurgaon are under threat. Working class settlements in the city increasingly face demolitions to accommodate fresh real estate projects and landlords seek to upgrade rentals to cater to well-paying clients. Perhaps the Draft National Urban Rental Housing Policy that currently seeks to formalize this market, could suggest models that protect and enhance this vital supply of affordable housing and, in particular, retain the flexibility that responds to the dynamic nature of urbanization and labor markets. Policy responses could consider micro Home Solutions' pilot project in Mangolpuri, Delhi, which helped homeowners with design and engineering inputs to retrofit their homes to create additional space to rent out. Centre for Policy Research’s analysis of processes like in-situ upgradation of slums and regularization of unauthorized colonies in the context of Delhi offer further insights into the merits of development models that enable homeowners to augment existing stock and create improved and fresh housing supply, including rentals.

Photo: Mukta Naik

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