The owner has to give three months notice to the tenant if he wants to increase the rent. This notice should be in writing.
This new law is not applicable to industrial purposes. The Act may be implemented in many states during this year This new act may bring down disputes between the landlord and tenants. It will become a major force for the property market all over the country.
small drops make a mighty ocean
- Agreement between both of them will be mandatory.
- The authority would issue a unique identification number and would upload all details of tenants on its website within seven days of agreement.
- Annual hike in rent would be 5% for domestic use and 7% for commercial.
- If the rent is not paid for two months the tenant will have to leave the room/house.
- The rent authority appellate tribunal would have to dispose of the case within 60 days.
- Agreement will apply to the successor of both sides in case of death.
Knowledge is power.
There was such a situation in Kerala till a few years ago that favoured the lessees. Many house owners who rented their houses had to suffer a lot to get the houses vacated . They had to spend a lot of money either in litigation , or as lump sum to the lessee and/or the political mediators . Above all they had to spend a lot of money on repairs of the damaged house once they get it vacated. So much so that people hesitated to give houses on rent.
In many states the rental period as restricted to eleven months considering the stamp duty rates and also considering the risk of not vacating.
Many people who construct or buy new houses as assets or for their post retirement living may not be able to stay in that house due to reason of job transfer, or other valid reasons. This they will rent to people with good reference and integrity. The advance rent amounts range from three months to six months depending on the risk perception by the landlord.
Of late many landlords face the risk of criminal activities by the hirers. This also becomes a perennial suffering and trauma for them by police cases , witness etc.
While on one side the government is encouraging housing sector by giving lower interest, longer terms, income tax benefits, interest subsidy etc on the other hand there is discouragement by such rent rules and increase in stamp and registration charges . State governments are increasing the property value to synchronise it with market value. But ironically they go archaic unrelated to market sentiments and realities in the case of rental sector.
This will work against the sentiments and confidence of house owners. I concur with the thread message that because of the new rules people will be reluctant to hire their houses and this will make renting houses difficult.