Two-Month Deposit Rule Introduced Under New Rental Reforms
India’s rental market is set for major changes under the new Home Rent Rules 2025, especially in cities like Bengaluru and Mumbai where tenants faced heavy upfront costs. The biggest reform caps security deposits for residential properties at just two months’ rent, ending the long-standing practice of demanding 6–10 months of advance payment. This move reduces financial pressure on tenants and aligns Indian renting norms with global standards.
The rules also make rental agreements more structured and transparent. Every agreement must be registered within two months, either online or at the registrar’s office. Failure to register will attract a ₹5,000 penalty. To avoid last-minute unfair clauses, the government has introduced a standard rental agreement template. Rent hikes are now regulated too—landlords can increase rent only once a year and must give a 90-day notice. Digital payments are mandatory for rents above ₹5,000, and TDS will apply when monthly rent crosses ₹50,000.
Dispute resolution will also become faster and more efficient. Special Rent Courts and Tribunals will handle rental conflicts, including evictions and deposit issues, and must resolve cases within 60 days. This overhaul is expected to reduce long-standing delays and bring clarity, predictability, and fairness to renting across Indian cities.
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