Renting A New Apartment: Important factors to consider

3344771391_02b74ac075_zRenting an apartment involves many factors, all of which are important. The process of renting requires hunting for a house, negotiating rent and deposit, signing the contract and then moving in. In India, it also means brokerage and extensive haggling in terms of clauses in the contract. Here are a few basics related to renting in India for both landlords and tenants.

Rental Agreements

Agreements are generally made to fall under the purview of rent control laws or their purposely made in order to not fall under such laws.

If the rent control laws  agreement is within the terms of the , the rent amount is determined through the evaluations and determinations of the executive, legislative or judicial authorities of the locality. For example, in the jurisdiction of New Delhi, the maximum rent amount per year is ten percent of the cost of construction and the market price of the land. However, these figures are historical in nature and they do not correspond to the contemporary costs. Thus, for those landlords who have properties which date back decades, the rent will be dismally low.

Lease agreements under the rent control laws favor the tenant to a large extent. The right of ownership is temporarily transferred to the tenant, however, the period of such transference in not specified. Tenants often refuse to vacate the premises and fight out the suit in court.

For this reason, most landlords prefer a lease and license agreement which stretches up to eleven months and has clauses for renewal after such a period. If you want to rent out any property in Kolkata or other Indian cities, this is the form of agreement which is in fashion. Rent control laws only apply to agreement made for the minimum period of twelve months thus giving landlords a loop hole to work with.


Before you move into the flat, you will be required to pay a deposit which acts as a security against the immovable property and against non-payment of rent. Properties in Kolkata generally command a deposit constituting two or three months of rent. Ensure that the contract clearly states that such a deposit is refundable and the procedure of refunding is also clearly stated. If there is delay in the repayment of deposit, contracts generally have clauses which enforce interest rates for late payments. Make sure that you are well versed with these clauses.

A few landlords also prefer advance payments for rent, however, these can be negotiable.

Rights of Parties

The Leave and License Agreement, by its definition and execution, is meant to fall outside the purview of standard rental control laws. Thus, the rights of both parties are completely negotiable between the landlord and the tenant. Each right and duty of each party has to be explicitly stated in the contract to ensure that there is no ambiguity in procedure.

Important clauses to include are notifications and procedure for premature termination of the lease. Both the landlord and the tenant have to go prior notice if either of them want to terminate the lease.

There are other clauses which deal with sub-letting the premises, over-staying and even the procedure of dealing with bills for utilities.


Agreements are generally under the local jurisdictions and thus controlled by local laws. Each state generally has its own act such as the Maharashtra Rent Act, 1999, Delhi Rent Act, 1995 and Tamil Nadu Buildings (Lease and Rent Control) Act, 1960. These acts are made in favor of the tenant. However, if the rent is beyond a certain value, then the jurisdiction shifts from local rent control laws to the Transfer of Property Act. The Transfer of Property Act (ToPA) gives the landlord certain duties such as disclosure of any shortcomings in the property and also ensures tenancy without interruption for the agreed upon period. However, landlords are allowed to visit the premises in order to investigate the health of the place. ToPA has more rights bestowed upon landlords making it easier for them to ask tenants to vacate.


Alex Ferdinand is a former real estate consultant who now works as a freelance writer. Alex’s incredible amount of experience in real estate in the Indian subcontinent has made him a veritable expert on all things related to leasing and buying property. Contact him for advice regarding the formalities involved with renting properties in Kolkata or anything else related to renting a new apartment.