| Summary: | Increase in residential house rent prompts social, health and economic problem to society. The problem is more pronounced in developing countries where social welfare programs are not available. Thus, it is imperative to examine the derivers of rising residential house rent to design appropriate housing policies and strategies to curtail the increasing rental price of housing. Previous studies focused on housing amenities, location, house size, construction materials and cost of housing units as the drivers of residential house rent. However, there were scanty of empirical evidences that showed the association of rental price of housing with house brokers, land policy, inflation, rural to urban migration and household size. Therefore, the main objective of the study is to investigate the determinants of rising residential house rent in Wolkite town by integrating these additional variables. Data were collected from 204 renter units by using questionnaire and estimated using ordinary least square method. In addition, keyinformant interview was conducted for triangulation purpose. The study found that on average 27.877% of the monthly income of house renters was spent for residential house rent payment. Houses located at the centre of the town, built from cement or ceramics and with more bedrooms were contributed to the rising residential rent of housing. Increase in household size, being male and literate also increased the rent of housing. The participation of house rent broker has played a significant role in the increasing rent of housing. In addition, the interview result revealed that high rural to urban migration, inflation and absence of written contract between homeowners and renters have contributed to the increasing rent of housing. Therefore, government and city administration should regulate housing rent through introducing legal contract between homeowners and house renters. House brokers should be legalized and set a lump-sum service charge in steady of percentage commission. Rural–urban migration should be managed properly by focusing on balanced rural–urban development. It can also be managed by increasing housing supply through cooperative housing, private sector housing investment and government housing development program. Lastly, housing mortgage should be available along with the liberalization of land market.
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