The central government has rolled out a significant reform package aimed at transforming the rental housing ecosystem in India. The New Rent Agreement Rules 2025 introduce compulsory registration, strict timelines, and stronger legal protection for both tenants and property owners. These changes are expected to bring greater transparency and discipline to a sector long plagued by informal practices and frequent disputes.
Registration Made Compulsory for All Rental Agreements
Every rent agreement for residential or commercial property must now be formally registered within sixty days of signing. Informal arrangements on stamp paper or verbal commitments will no longer hold any legal weight. Failure to register the document may result in a penalty of five thousand rupees, and the agreement will not be admissible in any legal proceeding.
The government will soon release a standard agreement format to ensure uniformity across the country.
Security Deposit Capped to Prevent Excessive Demands
The new rules put a clear limit on security deposits. For residential properties, the deposit cannot exceed an amount equal to two months of rent. For commercial properties, the cap has been set at six months of rent. The earlier practice of demanding eight to twelve months of rent in advance is now unlawful.
Rent Increase Allowed Only Once Every Year
Landlords are permitted to revise rent only once in a year. A written notice of ninety days must be provided before the revised amount becomes applicable. This step is expected to curb arbitrary and sudden rent hikes that often lead to disputes.
Stronger Protection Against Forced Eviction
Eviction rules have also been made clearer and more tenant friendly. The minimum notice period for eviction now depends on the duration of the tenant’s stay
• Less than one year stay requires a notice period of one month
• One to five years stay requires a notice period of two months
• More than five years stay requires a notice period of six months
Any attempt to forcibly remove a tenant without following the legal process, including actions such as cutting water or electricity supply or changing locks, will be treated as a punishable offence.
Fast Track Rent Courts to Speed Up Dispute Resolution
To avoid long drawn civil court battles, the government has proposed the setting up of special rent courts. These courts are expected to resolve rent related disputes within a window of sixty to ninety days. The move is intended to provide both tenants and landlords a quicker and more reliable mechanism for justice.
Landlord Entry Restricted Without Proper Notice
A landlord cannot enter a rented property without giving a written notice of at least twenty four hours. This measure seeks to protect tenant privacy and prevent misuse of authority.
Penalty for Overstay After Agreement Expiry
If a tenant refuses to vacate the property after the expiry of the agreement or after receiving a valid eviction order, the landlord will have the right to charge double rent until the property is vacated.
What the New Rules Aim to Achieve
The New Rent Agreement Rules 2025 aim to create a fair and transparent rental market. Formal documentation, clear notice periods, and strict guidelines on deposits and hikes are designed to protect tenants from exploitation. At the same time, landlords benefit from legal clarity and a faster dispute resolution process.
With India witnessing rapid urbanisation, these reforms mark a major step towards a more organised and balanced rental housing framework.
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