India's rent law 2025: Lower deposits, clear rules, more power to tenants

New Delhi, Dec 5, 2025

If you’ve ever rented a home and felt frustrated by huge security deposits, confusing agreements, surprise landlord visits, or unclear repair responsibilities, big changes are coming your way. India’s new rental rules aim to make renting fairer, simpler, and far more transparent for both tenants and landlords.

The new framework caps security deposits (two months’ rent for homes, six for commercial spaces), makes written and digitally registered agreements mandatory, clearly defines who pays for what repairs, ensures 24-hour notice before any landlord entry, and sets rules for rent hikes and evictions. But because land and rent laws are a State subject, each state will adopt the Model Tenancy Act differently, meaning the impact will vary depending on where you live.

In short: if you rent a home—or plan to in 2026—these reforms could save you money, protect your privacy, and give you far stronger legal clarity than ever before.

Two-Month Deposit Cap: The Most Tenant-Friendly Reform Yet

One of the biggest pain points for tenants—especially in metros—has been huge security deposits. In cities like Bengaluru and Mumbai, it was common to pay 6–10 months’ rent upfront, often stretching households financially.

Under the new framework:

Residential security deposits cannot exceed two months’ rent

Commercial deposits cannot exceed six months’ rent

As Advocate Tushar Kumar explains:

“Where the monthly rent is ₹25,000, the legally permissible deposit is now capped at ₹50,000—protecting tenants from earlier demands of ₹2–2.5 lakh.”

This alone makes renting significantly more affordable, especially for young professionals, students, and migrating families.

Mandatory Written, Registered Agreements—No More “Verbal Deals”

The law requires:

• A written tenancy agreement
• Digital stamping
• Mandatory registration with the Rent Authority within two months

This stops disputes over oral assurances and brings all tenancies into a formal, trackable system.

In fact, Mumbai already follows digital leave-and-licence registration. As Advocate Adhiraj Harish notes:

“Much of what the new law seeks to provide already exists in Maharashtra—standard templates, compulsory online registration, and clear regulation over licensor-licensee relationships.”

But the MTA goes further by standardizing practices nationwide—subject, of course, to state adoption.

Clear Rules for Eviction, Repairs and Rent Hikes

The new rental framework clarifies:

Eviction now needs a valid legal reason, such as:

• Non-payment of rent
• Structural changes
• Misuse of property

Landlords cannot force tenants out arbitrarily.

Repairs

To eliminate blame-shifting:

• Landlords handle major repairs (structure, pipes, wiring, geyser failure due to age)
• Tenants handle minor everyday issues or damages they cause

"For instance, rectification of a non-functional geyser due to age or internal defects lies with the landlord, while the replacement of a deliberately damaged fixture lies with the tenant. Collectively, these provisions cultivate a rental ecosystem grounded in fairness, accountability, and legal certainty," said Adhiraj Harish, Partner, D.M. Harish & Co.

Tushar Kumar says this creates:

“A rental ecosystem grounded in fairness, accountability, and legal certainty.”

Rent Hikes

Rent cannot be increased suddenly or unpredictably.

Landlords must:

• Follow the terms of the agreement
• Give at least 90 days’ notice

This gives tenants better planning ability.

Better Privacy Rights for Tenants

For the first time, privacy has been formally written into rental rules.

Landlords can enter a rented home only with 24 hours’ prior notice and only during daytime.

"Every rental now has to be backed by a proper written agreement that is reported to the Rent Authority. Tenants also get better privacy rights such as the fact that landlords must give at least 24 hours’ notice before visiting and can come only during daytime. Eviction can no longer be done casually; there must be a valid legal reason like non-payment of rent. Repair responsibilities are also clearer, with major work falling on the landlord and small fixes on the tenant.

The aim is to stop misuse, protect tenants, and make renting a more balanced arrangement for everyone," said Kunal Maliramani, Advocate, Accord Juris LLP.

State Adoption Will Shape How Fast These Rules Take Effect

Rent is a State subject, meaning each state must modify or adopt the Central Act. Some states—Tamil Nadu, Andhra Pradesh, Uttar Pradesh, Assam—have already moved forward. But the picture is more complex in states with older rent control systems. For example, Maharashtra has the Maharashtra Rent Control Act (MRCA) and the Pagdi system. The MRCA even exempts certain tenants (like banks or large companies) entirely.

Adhiraj Harish highlights the challenge:

“The MRCA exempts based on the nature of the occupant, while the new model tenancy law exempts based on the status of the owner. Harmonizing the two will take careful planning.”

Advocate Rohit Jain also warns:

“Being a State subject, the Central law may face challenges unless states notify their own rules adopting it.”

So while the framework is clear, implementation will differ across India—and may be slower in some states.

"Each state law has its own nuances. Taking for example, the situation of Maharashtra where the Pagdi system also exists and where the Maharashtra Rent Control Act (MRCA) presently applies. The MRCA regulates the landlord tenant relationship even under the pagdi systemn and the licensor licensee relationship. Further, under Section 3(1)(b) of the MRCA, it carves out that the act shall not apply based on the nature of the occupant eg. the MRCA does not apply where the premises are let to bank, PSU, companies with a paid up capital in excess of Rs.1 crore etc. However, in contrast the new tenancy law has applied the act based on the status of the owner of the property eg. If a premises is owned by a Company, University, Chirtable institution etc. the act would not apply.

Furthermore, part of what the new law seeks to provide for - has already been existing in Maharashtra. For instance in Mumbai, most rentals are covered under leave and license agreements which are compulsorily registrable, and for which the State has set out standard templates and enabled online registration, to provide ‘ease of doing business’ in the financial capital.

It would have to be seen how the legislature and executive achieve a harmonious interplay between MRCA and the Model Tenancy Act.

Similarly, each state would have to carefully implement the law taking into considerations its existing laws and specific situations," said Harish.

Digital Registration Becomes the Norm

As part of the nationwide shift, rental agreements will undergo digital registration—bringing better:

• Transparency
• Traceability
• Access to grievance redressal
• Dispute resolution through Rent Courts and Tribunals

This is a major step toward modernising India’s fragmented rental market.

[The Business Standard]