The Hidden Cost of Managing Rentals on Paper

Dhaka adds hundreds of thousands of new residents every year, and formal housing supply hasn’t come close to keeping pace. The result is a rental market that runs largely on informal arrangements — and a huge amount of it isn’t written down anywhere at all.

Verbal contracts are still the norm

A 2023 survey by the Bangladesh Institute of Planners found that rents in Dhaka’s Old Town rose 30–45% over just five years — often without any written agreement or clear legal justification behind the increase. Verbal contracts remain the standard way a tenancy actually gets agreed, which leaves tenants with little recourse against arbitrary rent hikes or sudden eviction, because there’s no record to point back to when a disagreement starts.

This isn’t limited to one neighbourhood. Much of the population in Dhaka’s densely populated areas depends on rented housing sustained through informal, socially-rooted arrangements rather than formal contracts — arrangements that work fine right up until they don’t, at which point neither side has anything to fall back on.

Informality cuts both ways

It’s worth being fair to the system as it exists: informal renting is flexible, fast to arrange, and doesn’t require either side to navigate paperwork or bureaucracy they may not trust. For a landlord renting out a single unit, or a tenant who needs to move in quickly, a handshake is often genuinely the path of least resistance.

The cost shows up later — in a dispute neither side can resolve because nothing was written down, in a deposit that’s remembered differently by the two people who agreed to it, in advance payments and charges that are easy to lose track of across months or years, in a rent increase with no paper trail to check it against. None of that is a failure of character on either side. It’s what happens when the record-keeping tool available is memory, and memory is not a reliable record.

Why this is a records problem, not just a housing problem

The housing shortage itself is a large, slow-moving structural issue — more supply, more affordable formal units, better urban planning. That’s not something a piece of software fixes. But underneath the shortage sits a separate, more solvable problem: even the rental relationships that do exist today are mostly undocumented, which makes every one of them harder to manage fairly, for owner and tenant alike.

A tenancy with the terms written down, the rent history logged, and the charges and payments recorded isn’t a solution to Dhaka’s housing supply — but it is a solution to a huge share of the disputes, misunderstandings and lost records that make renting harder than it needs to be for the people already in the system. That’s the specific, narrower problem worth solving first.