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Understanding the rental market to assess value of improved water quality

in low-income urban Dhaka

Farhana SultanaResearch Investigator

WASH Research Group

Centre for Communicable Diseases

icddr,b

Water and Health Conference

UNC, Chapel Hill, North Carolina

October 28, 2015

Background

• Dhaka is one of the fastest growing cities in the world with 15 million population

• 40% share of Dhaka residents live in slums, and this share is also growing rapidly

• Most households in Dhaka

slums live in rented housing

2

Photo credit: Wafiq Jawad, The World Bank

Reference: Rahman et al. 2014

Water supply for urban poor

3

Dug well (non-drinking source) Piped water collection

Water reservoir system

Shared water points Tap water system

Photo credit: Nuhu Amin, Nazrin Akter

“Improved” water supply for urban poor

• Most of the slum residents use shared water points for their daily water needs

• Though considered “improved,” these water points often do not provide safe water

4Reference: Hanchett et al. 2003, Pickering et al. 2015, Amin et al. (accepted for publication), 2015

– Dhaka municipality water supply authority chlorinate water

– Though intermittent supply and poorly maintained networks re-contaminate water

– Recent trials found these water contaminated with E.coli and no residual chlorine

Point-of-use (POU) water treatment technologies

• Correct and consistent use of POU technologies reduce the rates of child diarrhea substantially

• Intervention trials with liquid chlorine reduced diarrhea in many settings

5

Chlorination

Aqua tabs

Ceramic filtration

References: Arnold and Colford, 2007

Barriers to using POU water treatment technologies

• Worldwide, <10% most at risk households treat water correctly and consistently

• Studies conducted in Dhaka found 15 to 30% uptake of household chlorine tablets, even with free provision

• Cost, time, maintenance, water smell and temperature were added barriers

6Reference: Luby et al. 2008, Rosa et al. 2010, Luoto et al. 2011, Raymond et al. 2015 (accepted for publication)

Automatic point-of-collection chlorination device

• An alternative water treatment technology that automatically adds an appropriate dose of chlorine at the last stage of water collection

• Improves microbiological quality of drinking water

• Does not require individual level behavior change in the households

• Potential to be deployed where water points are shared by low-income urban residents

7Reference: Pickering et al. 2015

Photo credit: Nuhu Amin

Objectives

• To understand the turnover rates, strategies of competition and features of rental housing market systems

• To explore if landlords view provision of improved water as conferring a competitive advantage in attracting and retaining tenants

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Methods

• Study site: – Kallyanpur and Korail slums,

urban Dhaka

• Study period: – July - December 2013

• Eligibility criteria:– Shared water point users– Landlords, compound

managers and tenants living in the slum for > 5 years

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Data collection techniques

Techniques Type of respondents

Name of slum

Interviews= 25

N= 62

In-depth Interviews

Landlords Kallyanpur 10 10

Landlords Korail 10 10

Focus Group Discussions

Landlords Kallyanpur 1 8

Compound managers

Korail 1 8

Tenants Both 3 26

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In-depth interview with landlord Focus group discussions with tenants

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Typical housing in Dhaka slums

Kallyanpur Korail

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Rented versus empty rooms in a typical year (N=29 landlords)

IndicatorsMean Range

Rooms owned by the landlords 8.2 2-30

Rooms available for rent 7.0 1-26

Rooms rented 6.0 0-23

Empty rooms in previous year 1.2 0-5

Monthly rental fees in USD 20.7 12-29

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Rental market system in Dhaka slums

• Average monthly rental fee of a house was $21 including electricity and water supply

• A single room shared with average six people

• Support organizations, written rental agreements and advance rent payment systems were nonexistent

• Landlords maintain oral rental agreements for:– Payment details– Rules and responsibilities of sharing water and

sanitation facilities

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Looking for new tenants and new houses

• Females on both the tenant and landlord side mentioned to have most influence over choices:

– Which property to rent– Which applicant to select as tenant

• Word of mouth in the slums was the main strategy to attract tenants and rent houses

• Single men and followers of different religions were less preferred as tenants and landlords

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Characteristics of a good tenant (N=36)

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Cooperative user of shared water points

Own adequate furniture

Timely payment of rental fees

Provides >2 weeks advance notice

Nuclear family

Maintain cleanliness of WASH facilities

0% 20% 40% 60% 80% 100%

19

28

39

58

67

78

Important factors in choosing new houses by tenants (N=26)

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Spacious cooking arrangements

No single male tenants

Water system nearby

Concrete floored rooms

Accessible electricity supply

Safe and accessible water supply

Lower rental fees

0% 20% 40% 60% 80% 100%

12

19

25

31

50

75

77

Factors affecting rental properties and landlords’ investment

• Slums are often situated either on government or privately owned lands

• Slum eviction occurs frequently when public land is reclaimed by the government

• Evictions in both slums led to:– Damaging households, assets and properties– Forcing tenants to change slums and houses– Landlord reluctance to invest improving rental housing– Room vacancies

• 42% of tenants reported eviction 6-10 times in < 30 years

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Investments for rental households

• Landlords re-invested 6% of annual revenue that they received from a tenant in housing and compound improvements:

– New infrastructure and houses– Hand pumps– Sanitary and electrical services– Cooking areas to attract tenants

• Such investments also influences the increase in rental fees up to 5% in a typical year

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Conclusions

• Tenants value water quality when selecting among rental housing options

• Landlords may thus gain a competitive advantage if they can provide higher quality water at the compound level

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Next steps

• Intervention to deploy the automatic point-of-collection chlorination device to:

– Improve the water quality – Measure health impact– Provide competitive advantage in the rental market,

especially among female tenants– Benefit landlords to increase rental fees– Evaluate landlord and household willingness to pay

($0.12 - 0.25) for disinfected water– Collect feedback to refine the intervention

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Acknowledgements

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Stanford University Jenna Davis Amy J. Pickering Stephen P. Luby Yoshika Crider

FundingStanford University, Woods Institute for the Environment and the Urban Services Initiative at J-PAL

icddr,b Leanne E. Unicomb Nazrin Akter M. Nofiz Bin Zaman Probir K. Gosh Diana DiazGranados Astrid K. Dier Md. Mahbubur Rahman

Study participants Dustho Sasthyo Kendra (DSK)

Contact: farhana.sultana@icddrb.org

www.icddrb.org

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