Recognising PGs as homes may solve Bengaluru’s rental housing crisis

Bengaluru thrives on migration. Every year, tens of thousands of students and early-career professionals and job seekers arrive in the city in search
of opportunities. For many, paying guest (PG) accommodations offer the only affordable foothold. 

The Bruhat Bengaluru Mahanagara Palike’s (BBMP) recent move to regulate PG accommodations, under Section 305 of the BBMP Act, 2020, aims to bring order and safety to the sector.

The 10-point framework emphasises hygiene, documentation, surveillance, and safety infrastructure-- critical goals for any growing city. However, in their current form, the rules risk sidelining the very people they seek to protect, penalising small-scale operators who provide essential low-cost housing.

A BBMP survey in September 2024 found 2,193 authorised and 2,320 unauthorised PGs across its eight zones. Of the 4,513 PGs surveyed, 1,261 were non-compliant and 21 were shut down. Many more have been closed in recent months -- not for serious safety violations, but for technical violations such as not meeting minimum space norms or lacking formal documentation.

One of the most contentious rules is the requirement of 70 sq ft per person. The BBMP’s own Building Bye-laws (2004 and 2017) calculate occupancy using gross floor area (GFA), which includes kitchens, staircases, and shared spaces, not just the carpet area.

Yet, many closures are being ordered based on carpet area, a flawed interpretation that risks unjustified evictions, particularly in high-density zones.

Another guideline mandates 24x7 CCTV surveillance with 90-day video storage per camera. The intent – especially for women’s safety – is valid, but the costs are steep. Installing high-resolution cameras and maintaining 90-day storage can cost lakhs annually. For PGs with fewer than 100 residents, a 30-day storage period—already mandated under the Karnataka Public Safety (Measure) Enforcement Act—would be more practical and affordable.

Some requirements, such as clean water, sanitation, first-aid kits, and helpline displays, are necessary and widely accepted. However, implementation must consider ground realities. The rule mandating 135 litres of water per person per day assumes access to Bangalore Water Supply and Sewerage Board (BWSSB) supply, which many PGs lack. Most rely on borewells, RO units, or private tankers. Penalising operators for water scarcity beyond their control does nothing to improve compliance.

Mandatory registration with the BBMP and Food Safety and Standards Authority of India (FSSAI) is important but poorly incentivised. Many operators fear reclassification as commercial units, which brings significantly higher electricity and water tariffs. Under current commercial tariffs, a PG resident may pay around Rs 2,200 per month in utilities, compared to Rs 800 under domestic rates. For a 100-bed facility, that is an added cost of Rs 1.3 lakh monthly, which could instead be invested in fire safety, sanitation, or trained security staff.

This economic burden discourages formalisation and sustains a grey zone in which operators remain unregistered. Even those who do register are not necessarily better off. For example, in the Mahadevapura zone, 276 of 926 registered PGs were found non-compliant, yet none were shut. In contrast, Dasarahalli, with just 11 non-compliant, saw a couple of closures. Such inconsistencies point to administrative discretion rather than uniform policy application.

Not all requirements are burdensome. Displaying helpline numbers or maintaining first aid kits are reasonable and low-cost changes. But others, like employing only trained security personnel with established credentials, may suit large hostels or commercial establishments, not small PG operators. These requirements could be restructured as advisory or implemented through shared services in PG clusters. 

At the heart of the issue is the classification of PGs as commercial establishments, grouped with hotels, lodges, and guest houses. But the residents of PGs are not transient guests. They are long-term tenants, comprising students, migrant workers and early-career professionals, who cannot afford or access the formal rental housing market due to high security deposits and rent, to name a few.

Encouragingly, there are signs of policy movement. During the 53rd GST Council in June 2024, the Karnataka Revenue Minister called for hostels to be treated as residential facilities, citing a Karnataka High Court ruling. The Union Finance Minister also suggested a separate GST category for PGs and private hostels under the 2017 Central Tax notification.

Reclassifying PGs as residential-use services is the logical next step. It would exempt them from Bangalore Development Authority’s commercial land-use rules, such as the 40-foot road width clause, which currently blocks trade licence renewals for PGs located on narrower streets. It would also open the door to domestic utility rates. This must be accompanied by regulatory clarity on how occupancy is calculated, using gross floor area, not just carpet area. Small PG operators should have access to simplified digital registration, subsidised fire safety equipment, and access to shared services for segregation and disposal of solid waste and security services with established credentials.

PGs are not luxury accommodations. They exist because people do not have access to more affordable options. If the city is unable to expand formal, affordable rental housing for low-income migrants at scale, it should consider supporting those who are stepping in to meet that need, rather than discouraging them through burdensome rules. The city’s approach should go beyond regulation because everyone deserves a space to live with dignity.

(The writer is a researcher at the Indian Institute for Human Settlements and works on issues of affordable housing and rental housing)