Model Tenancy Act: How new security deposits, rent agreement, entry & exit rules will benefit tenants, landlords
A key reform under the Act is the requirement that all tenancy agreements be digitally stamped, registered online, and jointly reported to the District Rent Authority within two months. This seeks to bring India’s heavily informal rental market onto a formal platform.
- Dec 3, 2025,
- Updated Dec 3, 2025 4:53 PM IST
India’s rental housing framework is undergoing a major overhaul as states increasingly adopt rules based on the Model Tenancy Act (MTA), 2021, a central blueprint designed to formalise rental agreements, protect tenant rights, and ensure greater transparency in landlord–tenant relationships. The new laws introduce several consumer-friendly provisions—most notably caps on security deposits, mandatory written agreements, and clear protocols for entry, inspection, repairs and eviction.
A key reform under the Act is the requirement that all tenancy agreements be digitally stamped, registered online, and jointly reported to the District Rent Authority within two months. This seeks to bring India’s heavily informal rental market onto a formal platform. States such as Tamil Nadu, Uttar Pradesh, Andhra Pradesh and Assam were early adopters, and Maharashtra and Karnataka have now aligned their rules with the MTA, marking a major shift for high-volume rental markets such as Mumbai and Bengaluru.
Security deposits
Under the Model Act, the security deposit for residential properties cannot exceed two months’ rent, while commercial premises may collect up to six months’ rent. This significantly reduces the financial burden on tenants—particularly in metros where landlords traditionally demanded advances equivalent to 6–12 months of rent.
The Act mandates that security deposits be refunded on the day the tenant vacates, after deducting legitimate dues. “This dramatically lowers the entry cost for tenants and makes renting more accessible for young professionals and migrants,” said Apurva Agarwal, founder of Universal Legal.
Written agreement
A formal written agreement is now compulsory. Both parties must jointly inform the Rent Authority within two months of signing. Disputes are expected to be resolved within 60 days, a major improvement over the long and often opaque processes earlier.
Rules for entry, inspection and emergencies
The Act clearly defines when landlords may enter rented premises:
with 24-hour written or electronic notice,
for repairs, inspections or other valid reasons specified in the agreement,
and never before sunrise or after sunset.
Entry without notice is allowed only in emergencies such as floods, fire or natural disasters.
Eviction only
Landlords can seek eviction through the Rent Authority only on specific grounds—such as non-payment of rent for two consecutive months, misuse of property, or structural alterations without consent. Tenants overstaying after the lease period may face enhanced rent penalties.
Repair responsibilities
Unless stated otherwise:
Landlords must handle structural repairs, electrical wiring, plumbing replacements, whitewashing and painting.
Tenants must manage minor repairs such as taps, switches, fixtures, glass panels, locks, and maintenance of gardens or open spaces.
If a landlord refuses to carry out essential repairs that render a property uninhabitable, tenants may abandon the premises with 15 days’ written notice. In cases of force majeure, landlords cannot charge rent until the home becomes livable again.
With Maharashtra and Karnataka joining the early adopters, registered rental agreements are rising sharply. Mumbai saw 3.33 lakh agreements in 2023, and registrations rose another 13% in the first half of 2024, according to the state’s Inspector General of Registration (IGR).
Rent raise
The new rules bring clarity and structure to renting in 2025. Landlords can raise rent only once every 12 months and must give 90 days’ written notice, ensuring tenants aren’t hit with sudden increases. Evictions now require a formal order from the Rent Tribunal, making actions like changing locks or cutting utilities punishable. Tenants are guaranteed privacy, with landlords required to give 24 hours’ notice before entering. For essential repairs, tenants may fix issues themselves and deduct costs if landlords fail to act within 30 days, provided bills are submitted. Mandatory police verification and clearer norms aim to make renting safer and more predictable for millions.
Who benefits?
Experts note that the Act strikes a fair balance. It offers legal protection and reduces uncertainty for both landlords and tenants. While tenants benefit from capped security deposits and safeguards against sudden eviction, landlords gain from clearer enforcement mechanisms, compensation in cases of overstay, and strict rules preventing subletting without permission. As more states implement the Model Tenancy Act, the rental landscape is expected to become increasingly formal, transparent and attractive for investors.
India’s rental housing framework is undergoing a major overhaul as states increasingly adopt rules based on the Model Tenancy Act (MTA), 2021, a central blueprint designed to formalise rental agreements, protect tenant rights, and ensure greater transparency in landlord–tenant relationships. The new laws introduce several consumer-friendly provisions—most notably caps on security deposits, mandatory written agreements, and clear protocols for entry, inspection, repairs and eviction.
A key reform under the Act is the requirement that all tenancy agreements be digitally stamped, registered online, and jointly reported to the District Rent Authority within two months. This seeks to bring India’s heavily informal rental market onto a formal platform. States such as Tamil Nadu, Uttar Pradesh, Andhra Pradesh and Assam were early adopters, and Maharashtra and Karnataka have now aligned their rules with the MTA, marking a major shift for high-volume rental markets such as Mumbai and Bengaluru.
Security deposits
Under the Model Act, the security deposit for residential properties cannot exceed two months’ rent, while commercial premises may collect up to six months’ rent. This significantly reduces the financial burden on tenants—particularly in metros where landlords traditionally demanded advances equivalent to 6–12 months of rent.
The Act mandates that security deposits be refunded on the day the tenant vacates, after deducting legitimate dues. “This dramatically lowers the entry cost for tenants and makes renting more accessible for young professionals and migrants,” said Apurva Agarwal, founder of Universal Legal.
Written agreement
A formal written agreement is now compulsory. Both parties must jointly inform the Rent Authority within two months of signing. Disputes are expected to be resolved within 60 days, a major improvement over the long and often opaque processes earlier.
Rules for entry, inspection and emergencies
The Act clearly defines when landlords may enter rented premises:
with 24-hour written or electronic notice,
for repairs, inspections or other valid reasons specified in the agreement,
and never before sunrise or after sunset.
Entry without notice is allowed only in emergencies such as floods, fire or natural disasters.
Eviction only
Landlords can seek eviction through the Rent Authority only on specific grounds—such as non-payment of rent for two consecutive months, misuse of property, or structural alterations without consent. Tenants overstaying after the lease period may face enhanced rent penalties.
Repair responsibilities
Unless stated otherwise:
Landlords must handle structural repairs, electrical wiring, plumbing replacements, whitewashing and painting.
Tenants must manage minor repairs such as taps, switches, fixtures, glass panels, locks, and maintenance of gardens or open spaces.
If a landlord refuses to carry out essential repairs that render a property uninhabitable, tenants may abandon the premises with 15 days’ written notice. In cases of force majeure, landlords cannot charge rent until the home becomes livable again.
With Maharashtra and Karnataka joining the early adopters, registered rental agreements are rising sharply. Mumbai saw 3.33 lakh agreements in 2023, and registrations rose another 13% in the first half of 2024, according to the state’s Inspector General of Registration (IGR).
Rent raise
The new rules bring clarity and structure to renting in 2025. Landlords can raise rent only once every 12 months and must give 90 days’ written notice, ensuring tenants aren’t hit with sudden increases. Evictions now require a formal order from the Rent Tribunal, making actions like changing locks or cutting utilities punishable. Tenants are guaranteed privacy, with landlords required to give 24 hours’ notice before entering. For essential repairs, tenants may fix issues themselves and deduct costs if landlords fail to act within 30 days, provided bills are submitted. Mandatory police verification and clearer norms aim to make renting safer and more predictable for millions.
Who benefits?
Experts note that the Act strikes a fair balance. It offers legal protection and reduces uncertainty for both landlords and tenants. While tenants benefit from capped security deposits and safeguards against sudden eviction, landlords gain from clearer enforcement mechanisms, compensation in cases of overstay, and strict rules preventing subletting without permission. As more states implement the Model Tenancy Act, the rental landscape is expected to become increasingly formal, transparent and attractive for investors.