Tenure security and housing investment: Owner-occupants and renters in Bangladesh's poor settlements

Abstract

This paper explores the relationship between land tenure security and housing investment among households in Bangladeshi poor settlements. The level of housing investment is measured through the type of physical structure of the house, or more specifically, floor materials. Cluster-robust standard error logistic regression method is utilized to explore this relationship in order to fix the issue of households located in the same settlement being correlated with each other. The results show that houses with greater tenure security, whether owner-occupied or rented out, are more likely than houses with insecure tenure to have cement floors, which are more permanent and expensive than other types of floors like bamboo, wood, or dirt/mud. Importantly, renters are more likely than owner-occupants to have cement floors. In sum, although greater tenure security may positively impact housing investment, the market force in which housing is seen as a business opportunity may be an equally strong factor in encouraging investment even in poor communities.