The Centre’s nod to Model Tenancy Act will help create adequate rental housing stock for all income groups, especially benefiting affordable housing.
The Act aims at creating a vibrant, sustainable and inclusive rental housing market in the country.It will put an end to the illegal rental market . Instead, it will help formalise the rental housing market by overhauling the legal framework that balances the interests of both landlords and tenants. The Act makes it compulsory to enter a written agreement for renting property. At the same time, it makes it easier to rent a property as it puts an end to arbitrary security deposit and putting a 2 month limit of maximum security deposit. Banning the jurisdiction of courts, the Act ensures a speedy redressal of tenants grievances within 60 days by Rent Tribunal. There are enough safeguards for landlords also which will encourage them to rent out their properties. There will be no eviction of tenant during tenancy. The Act will give a guiding framework to all states to make their tenancy Acts contemporary.
Says Mr. Pradeep Aggarwal, Founder & Chairman, Signature Global and Chairman, Assocham National Council on Real Estate, Housing & Urban Development, ” This is a very progressive move towards achieving the aim of ‘Housing for All’ as according to the Housing Ministry, it will unlock 10 million homes lying vacant. Moreover, the formalisation of rental housing market will help increase rental yield on one hand it will attract private investment in housing, on the other hand, it will encourage people to buy homes for investment purposes because of higher rental yield. All this will lead to the growth of affordable housing segment which has maximum demand .