House Rent Issues in Dhaka: A Growing Concern

Dhaka, the fourth largest city in the world with a population of over 24 million people, faces a growing and significant challenge. The densely populated megacity in Bangladesh sees its population expand on a daily basis with people frequently migrating to Dhaka. The main driving forces behind migration to the city are poverty, job search, and societal pressure. According to the Population and Housing Census 2011, over 12 million people lived in the Dhaka division. But the Population and Housing Census 2022 reported that nowadays 44 million people live in the Dhaka division. So, the population growth rate at 1.74% in the division now stands. Between 1991 and 2001, population growth was 4.15 per cent and 7 per cent, respectively.

The Tenant-Landlord Burden and the Soaring Cost of Housing

The rental housing market in Dhaka is defined by a severe power imbalance between landlords and tenants, but the crisis runs deeper than a simple lack of regulation. It is fuelled by a vicious cycle where rampant land speculation directly translates into an unbearable burden for the city's millions of renters.

Increasing migration to cities and high population growth have resulted in a rapid decline of affordable urban land, causing house prices to exceed the reach of middle- and low-income households. This is not just due to a housing shortage but because land itself has been transformed into a high-yield financial asset. Land prices in Dhaka, for example, increased by an unprecedented 2,700% between 2000 and 2021, turning property into a speculative commodity rather than basic shelter. 

In recent years, the cost of housing in Dhaka has been rising for clear financial reasons. With gains from land speculation far exceeding returns from traditional financial systems, a flood of capital—including a huge portion of the nation's 'black money' and a significant amount of foreign remittance—pours into the real estate market, driving prices ever higher. Consequently, house rent has been rising dramatically. Roughly 20–25% of Dhaka's overall population own their home; the remaining 75–80% of people rent their homes. The majority of middle-class families in this group are finding it difficult to deal with the unchecked increase in rent prices. And it is estimated that 65 per cent or more of their monthly income goes toward paying rent.

This unregulated environment persists despite the existence of a legal framework. The House Rent Control Act of 1991 was enacted to protect tenants from arbitrary hikes and unfair eviction. However, the law is widely considered obsolete and is almost never enforced, leaving tenants with little to no practical legal recourse against a market driven by powerful financial interests.

Due to the rising demand for rental homes, landlords are raising rents. For many property owners, maximising rental income is essential to justify their high-cost investment in an asset-driven market. On average, tenants in Dhaka report annual rent hikes of 8-10% and often significantly more in high-demand neighbourhoods, far outpacing income growth. The house owner fixes the rent for the house as per their wishes, even though it is seen that sometimes house rent increases yearly three or four times. In rare instances, landlords would also put pressure on renters to vacate the property if the latter is unable to comply with the request.

In response to these mounting pressures, the new administration has acknowledged the public's concerns. Mohammad Ejaz, Administrator of the Dhaka North City Corporation, addressed the issue, stating, "We are also deeply concerned about this matter. It's truly unfortunate when 65% of a person's income is spent on house rent. We will take measures to bring rent under control. Furthermore, steps will be taken to amend and update the House Rent Control Act of 1991." He also pledged that these actions would be undertaken within their current term in office.

This crisis is felt across the city, although rents vary significantly between neighbourhoods like Bashundhara, Gulshan, Mohammadpur, and Mirpur. Multiple factors, including geographical location, house size, number of bedrooms, and number of bathrooms, are considered. Ultimately, these factors combine to create a deeply challenging rental market where the most powerful force is no longer just location or size but the treatment of housing as a speculative tool for financial gain.
The Economic Cost of High Rent

When high rents absorb a significant portion of the household income, leaving less available for consumption, investment or other expenses, it reduces the overall multiplier effect of the money circulating through the economy. When landlords or investors extract high rents without improvements to the housing or create new supply, this can cause market inefficiencies. Wealth is amassed by the rent-seekers, and less money is available for generating new goods or services. Moreover, young salary earners spending a giant chunk of their earnings means they have less money available for self-improvement, marriage or family, and the pursuit of higher education. Burdening the youth population with high rents means their futures are being affected during a time when they need to grow.

Government Structure and City Administration

The Local Government (City Corporation) Amendment Bill 2011, which was approved by the Bangladeshi Parliament, was used by the government to dissolve the Dhaka City Corporation on November 29, 2011, following its introduction to the Parliament on November 23. The city corporation will be divided into two corporations, North and South, with the southern wing controlling a larger portion of the city. Due to the fact that each corporation would be autonomous, Dhaka will have two mayors. According to the government, bifurcation would guarantee that the citizens of the city would receive better quality municipal services.

A total of 54 wards make up the Dhaka North City Corporation, which includes the thanas of Mirpur, Mohammadpur, Sher-e-Bangla Nagar, Pallabi, Adabor, Kafrul, Dhaka Cantonment, Tejgaon, Gulshan, Rampura, Banani, Airport, Khilkhet, Vatara, Badda, Uttara, and others. The Dhaka North City Corporation (DNCC) is currently led by Mohammad Ejaz, who was appointed as Administrator on February 12, 2025.

The 75 wards that make up Dhaka South City Corporation include those in Paltan, Motijheel, Jatrabari, Kotwali, Sutrapur, Bangsal, Wari, Ramna, Gendaria, Chowkbazar, Lalbagh, Hazaribagh, Dhanmondi, Shahbagh, New Market, Khilgaon, Kamrangirchar, and other thanas.

The Dhaka North City Corporation (DNCC) is currently led by Mohammad Ejaz, who was appointed as Administrator on February 12, 2025. 

Currently, the Dhaka South City Corporation (DSCC) is being administered by Md. Shahjahan Miah, who was appointed as Administrator on February 13, 2025. There is also a recent court declaration stating that Ishraque Hossain is the new mayor of DSCC, but this is pending further action. 

Efforts and Challenges in Addressing Dhaka’s Housing Crisis

Urban Planning Initiatives: Both Dhaka North City Corporation (DNCC) and Dhaka South City Corporation (DSCC) have collaborated with the Chittagong Development Authority model to improve urban planning, with DNCC focusing on traffic management in high-density areas like Mirpur.

Housing Regulation Gaps: Despite administrative decentralisation, neither DNCC nor DSCC has implemented comprehensive rent control policies, leaving tenants vulnerable to arbitrary rent hikes. The lack of standardised rent criteria, as proposed, remains unaddressed.

Administrative Instability: The recent administrative appointments and the pending mayoral status for DSCC highlight governance challenges, potentially delaying critical housing reforms.

Overpopulation Pressure: The rapid population growth (1.74% annually) continues to strain municipal resources, with both corporations struggling to address housing shortages effectively.

To address the market imbalances and inefficiencies and to ensure a better future for the Bangladeshi youth, who make up more than half the country’s population, house rent should be fixed by a standard. The government must establish a criterion for determining a house's rent. It lessens the unfairness toward the tenants. The house rents in Dhaka city can be fixed upon the aforementioned thirteen features by enforcing this method of estimation, making it impossible for landlords to voluntarily determine the house rent, reports UNB.