On Wednesday, the Union Cabinet was seeing the clearance of the Model Tenancy Act that is in relation to the Rental Housing framework of the society.
The Union Cabinet approved the Tenancy Act in order to help regulate the Rental Housing Legal Framework in the country so as to help spread its overall growth.
The Cabinet said that the Model Tenancy Act will smoothen the unlocking of the already vacant rental housing purposes.
Not only this, but the Cabinet also mentioned that the private participation in the rental housing as a business model in relation to the huge shortage of housing will also be stimulated due to the act.
The draft of the Model Tenancy Act was first released on the year 2019 which aims to build trust between the Tenants and the Landlords by clearly putting forth their responsibilities.
What does the Model Tenancy Act say?
- The Model Tenancy Act aims to create a vibrant, sustainable and inclusive rental housing market in India;
- The issue of Homelessness will be addressed as the act will allow creation of enough rental housing stock for all the income groups;
- Institutionalizion of Rental Housing will be a part of the act moving it slowly towards the Formal Market;
- The act will establish a Rent Authority to regulate the renting areas;
- It will also be in place to protect the interests of Landlords and Tenants;
- The authority will provide mechanism to speedily resolve disputes;
- The security deposit will now be of maximum two months of rent in case of residential premises and six months in case of non-residential premises;
- The amount will differe from city to city.
The major provision in the act is:
If all the conditions in the rent agreement are completed by the Landlord (i.e. Giving Notice) and the Tenant fails to empty the area after the stay period has expired, the Landlord is allowed to charge two times the monthly rent for 2 months and 4 times after that.
Under the above situations, the Landlord or the Property Manager can enter the rented areas after giving a notice to the tenant, in written or electronic form 24 hours before visit.
