Intervention required

Most tenants in Phuentsholing are at the mercy of their landlords.

You either silently accept any increase in the rent, even if it is twice in one year, or risk being evicted.

Some landlords are taking advantage of the situation. Can you blame them?

According to the basic law of demand and supply, if supply is low, the market price goes up.

Therefore, those landlords who are hiking their rents every year, in excess of the permissible 20 percent of the Tenancy Act every two years, are simply making the most of the situation. Which businessperson does not take advantage of such a situation?

Some may call it greed. Others may simply see it as the market moving towards a natural equilibrium. If we only go by basic economics, the situation is nothing out of the ordinary.

But this situation is not an example in an economics text books. It is a reality in Phuentsholing, involving people and families, and their homes.

One of the problems is that no agreements based on the Tenancy Agreement are signed between landlord and tenant. The advantage goes to the landlord.

The Phuentsholing thromde says that it cannot regulate the market as it is the private sector. It only does so to settle disputes between landlord and tenant, and that too, only when an agreement has been signed. But the problem is that most landlords are not willing to sign an agreement as per the Tenancy Act.

There is a need for the thromde to make a courageous move on this issue and intervene.

When a service is provided, such as an apartment, there needs to be an agreement to protect both parties, the landlord and tenant.

In a nutshell, the tenant must be protected from indiscriminate rent hikes and threat of eviction. Tenants should also get the required basic services on a consistent basis. The landlord should be protected from “bad” tenants, who do not take care of the property, and cause a nuisance to other tenants.

The problem facing the thromde will be ensuring that landlords get a return on their investments, while protecting tenants from unfair treatment.

Research will have to be carried out to determine which solution to pursue: rent stabilisation (how much the rent can be raised over a period of time) or rent regulation (the placing of a cap).

The situation is a tricky one –  one that requires careful thought and planning. But there is a need for one agency, any agency, to intervene.

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