Tenants outcry as BHC goes ahead with rental hikes
Botswana Housing Corporation ( BHC) forged ahead with its rental hike effective April 1, 2021 despite previously showing signs of turning back on the increase.
April 1, is popularly known as All Fool’s Day, but there was nothing to laugh about this past Thursday, as scores of Batswana grappled with the increase in all basic commodities: food, petrol and rentals.
And as if the 14 percent VAT tax on commodities is not enough, the high rentals have given the phrase ‘ buckle up’ a whole new meaning as accommodation gobbles up a chunk of many household’s income in Botswana, according to Statistics Botswana.
The high rentals in Botswana, particularly in urban areas, have also cast light on the urgent need for affordable housing and for Land boards to improve land allocation turnaround time so that more Batswana can build their own houses.
Low cost range has gone from P537 to P2050, medium from P1330 to P3700, high cost from P2162 to P5200, town houses from P1866 to P5020 and flats from P1238 to P3500. Although this seems like an insane jump, BHC CEO Reginald Motswaiso in December 2020 told media that they had realised that the previous rates “were not making any economic sense”. According to BHC, of the entire rental share, individual tenants make up nearly 30 percent ( 27.45 percent), while companies are at 27.35 percent and government makes up 45.20 percent. A concerned tenant Samuel Molato said considering that salaries have not been adjusted and that most formal sector workers earn “peanuts” – most people, himself included, would see rent gobbling up a large chunk of incomes.
“Many people in Gaborone struggle just to keep a roof over their heads – you find that if someone earns for example P12 000, about a quarter of that goes to rental – that is too much”. He said this has led to unhealthy living conditions,
where some people share houses – it is not surprising nowadays to find four to five people living in a two- bedroomed house, and some of them not even related. He said government should at least prioritise a rental subsidy for deserving Batswana. “If I as a Motswana have been renting out a property long- term and have been paying on time without any hassle, then surely I deserve a subsidy” He said going forward government should consider rental subsidies, which are government funded programmes that assist low- income households pay for their rent on market rate rental units: conditions are outlined for a unit identified and an established housing authority pays for a portion while the tenant pays the balance.
This is a method common in developed countries such as the United Kingdom, Denmark, and USA. He also noted that Botswana has too small a population to be grappling with an accommodation crisis. “There are places to live in Botswana, particularly in Gaborone, but because prices for rentals are not regulated, you find that the pricing is insane – they are targeted at expatriates and the rich, because us ordinary Batswana cannot afford those.
“Urban housing is key to the development of any country and Botswana should prioritise this”. He said the worst part is that it took long for Batswana to be allocated land, adding that he had applied for land in Kgatleng, but to date, he was still on the “waiting list”. Despite public outcry and disgruntlement, the rental hike on BHC houses has been long coming. In 2019, Government pushed the corporation to increase prices citing a 16- year period since rental prices were last adjusted. In July 2018, the then Minister of Infrastructure and Housing Development Vincent Seretse, told Parliament that it was a “totally unacceptable anomaly” that BHC had not increased rentals in more than a decade. BHC has argued that the current rental fees charged for BHC houses make it difficult to meet the maintenance cost that the parastatal incurs, and that the low rentals had “killed” the rent- to- buy scheme as the house purchasing rate is low.