Draft tenancy law caps security deposit

Comments invited till August 1
The Centre has proposed a model tenancy law that States and Union Territories can enact to regulate renting of premises, including setting a maximum of two months’ rent as security deposit, a three-months notice for raising the rent and appointment of rent authorities. The draft of the Model Tenancy Act, 2019, was placed in the public domain on Wednesday by the Union Ministry for Housing and Urban Affairs (MoHUA), an official said, adding that comments had been sought from the public, after which the draft would be sent to the Cabinet for its nod. A statement by MoHUA on Thursday said comments were invited till August 1. Finance Minister Nirmala Sitharaman had said in her Budget speech on July 5 that the government would be coming up with a model tenancy law. “It [model law] will enable creation of adequate rental housing stock for various income segments of society including migrants, formal and informal sector workers, professionals, students, etc. and increase access to quality rented accommodation, enable gradual formalisation of rental housing market. It will help overhaul the legal framework vis-à-vis rental housing across the country,” the statement read. Advance security deposit for residential properties would be capped at two months’ rent and one month’s rent for non-residential properties. “After coming into force, no person shall let or take on rent any premises except by an agreement in writing. Within two months of executing the rental agreement both landowner and tenant are required to intimate to the Rent Authority about the agreement and within seven days a unique identification number will be issued to both the parties,” the statement said.

Source : https://www.thehindu.com/todays-paper/tp-national/draft-tenancy-law-caps-security-deposit/article28393728.ece

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