The Effect Of Living In Rental House On The Household Welfare: The Case Of Ethiopian News Agency’s Employees

Abstract

Lack of own house forces the residents to live in the rental house. Living in a rental house also affects the life of the renter since spending on rent hurts the basic needs of the household. This study evaluates the effects of living in a rental house on household welfare using cross-sectional data from Ethiopian News Agency employees. A sample of 133 (67 house renters and 66 house owners) using stratified random sampling technique. The data generated to meet the objectives of the study were collected using structured paper print questionnaire. The international poverty line is set at 2.15 USD converted in to Ethiopian birr per capita per day for underdeveloped world countries assuming that all gender and age group in household members consume the same and equal amount of reported expenditure was used to identify poor and non-poor. The study applied descriptive statistics and binary logistic regression model to evaluate the effect of living in rental house on household welfare. The descriptive finding of the study showed that the average monthly household food and nonfood expenditure per adult, having the basic house material, consuming a variety of foods per day, saving and the room occupancy status of a house renter is significantly low compared to house owner-employees. Living under the poverty line for rented houses is more than twice relative to households living in their own houses in which incidence of living under the poverty line for households living in rented houses is 0.31 and 0.14 for households living in their owned houses. One-third of the studied employees who are living in rented houses live under poverty shelter. The result of the binary logistic regression showed that living in a rented house, household size, and dependency ratio negatively affect the household welfare status while marital status, age, income, and saving positively affect household welfare. The study suggests that the government should increase housing development projects, encourage house builders through subsidizing, empower mortgage banks for constructing public houses, regulate the price of house rent and should control intra and inter migration. Ethiopian News Agency Board of Management should also give special attention to subsidize house renter employees, encourage employees with low education to improve their education for better positions, and work with banks to get a loan