Do you sign the rent agreement before renting a home?
With the current economic problems being a little harsh on the real estate industry of the nation, there has been a sharp rise in the number of people preferring to rent rather than buying. The latest MBRI, released in June 2013, also suggests that renting should be preferred for the time being. But before going in for renting a property, there are many factors that should be taken into consideration. Apart from the basic factors like location, budget and neighbourhood, and asking a series of questions to the landlord in order to confirm a comfortable and hassle free stay in the house, the rent agreement should be given utmost importance.
With many of the Indian home buyers postponing the property buying decision, Makaan.com researched about their existing knowledge and preference in the field of renting a residential property; the most important aspect of the research was whether the people opting for renting a property sign a rent agreement. Interestingly, the difference between the people who did and did not sign the rent agreement was marginal but the majority was of the ones who did not sign it. Therefore, in this article, Makaan.com brings in light the reasons as to why the rent agreement is of such importance and how it benefits anyone opting for a property on rent.
Importance: A rent agreement entails all the terms and conditions under which a property is given out on rent. It includes the details of the parties involved in the transaction. Carefully reading and scrutinizing the rent agreement is highly essential and beneficial for any tenant as the same helps in avoiding any future legal issues between tenants and landlords. The following are the factors that should be kept in mind prior to signing the house rent agreement:
Background check: Prior to signing the agreement make sure that the person who is projecting himself as the landlord is the actual owner of the house. There have been instances when caretakers or relatives show themselves as the owner of a house and take the rent without the knowledge of the actual owner. To check the integrity of the owner, you can ask for a look in the official documents like the NOC and utility bills of the society complex etc.
Terms of payment: Prior to signing the dotted line, cross check the payment details. The agreement should mention the rent amount, the period within which the rent is expected every month, the overhead charges that are to be paid by the tenants, the mode of payment i.e. cash, cheque or bank transfer and the penalty charges, if any. Make sure that the agreement also mentions the amount of the security deposit. The rent escalation clause is another factor that should be paid attention to; it includes the terms of increasing the rent amount by the landlord.
Tenure: A rent agreement is usually signed for 11 months. Check whether the same is the case in your rent agreement. Also, check the notice period that is there if the agreement is cancelled prior to completion.
Investing in a property in any form is considered to be a milestone in terms of financial investments; therefore, do a proper market research and survey prior to finalizing anything. For more of such poll reports and to cast your vote in a poll, visit MakaanIQ.