Renting out your property is an excellent way to generate extra income while ensuring your property is properly maintained. However, disputes between landlords and tenants often arise due to poorly drafted rental agreements. A comprehensive agreement that covers all key clauses ensures a smooth, mutually beneficial rental experience. Infinity Housing explains the essential elements to include in your rental agreement.
Must-Have Clauses in a Rental Agreement
A well-structured rental agreement protects both landlord and tenant. Below are the key clauses to include:
1. Personal Details
The agreement should list the full names and identification details of both landlord and tenant. Include the complete property address along with a description of fixtures, furnishings, and amenities provided.
2. Duration of Occupancy
Rental agreements are usually signed for 11 months with options to renew. Clearly state the start and end dates. If there is a lock-in period, mention it so the tenant cannot terminate the agreement prematurely.
3. Rental Charges
Specify the monthly rent, payment mode, and due date. Include penalties for late payments, if any, to avoid confusion.
Mention the amount of security deposit and outline the conditions for its return. Typically, the landlord must return the full deposit at the end of the tenancy, minus legitimate deductions for damages.
5. List of Items and Amenities
Include a detailed inventory of all furniture, appliances, and other amenities provided with the property. This avoids disputes about missing or damaged items when the tenant vacates.
6. Maintenance and Repairs
Clearly define responsibilities for maintenance:
- Tenant: Minor repairs like leaking taps, light bulb replacement, or minor wear and tear
- Landlord: Major repairs and overhead maintenance charges
Documenting these responsibilities prevents misunderstandings later.
7. Proper Use of the Property
Specify the permitted use of the property. Tenants should not conduct illegal activities or convert the property to commercial use without written permission.
8. Alteration and Renovation
Tenants must not make alterations or renovations without the landlord’s approval. Any structural or cosmetic changes should be documented and agreed upon in writing.
9. Notice Period
Include a mutually agreed notice period for early termination. Both parties should adhere to this clause to ensure fairness.
10. Renewal and Escalation Clause
State whether the contract can be renewed. The escalation clause allows the landlord to increase the rent by a specified percentage upon renewal.
The rental agreement must be signed and dated by both parties. For added legal protection, it is recommended to get the lease registered with the local authority or court.
Frequently Asked Questions
Yes, registration provides legal validity to the rental contract and safeguards both parties in case of disputes. While agreements below 12 months can be unregistered, registering is always safer.
Typically, tenants are responsible for minor repairs, such as fixing leaking taps, replacing bulbs, or unclogging sinks. Landlords cover major repairs, like plumbing replacements, electrical rewiring, or structural damage.
No, rent cannot be increased during the active tenancy unless mutually agreed. However, the landlord can specify an escalation percentage in the renewal clause for subsequent terms.
If a lock-in period is included, tenants may need to pay a penalty for early termination. Otherwise, the tenant must provide the agreed notice period to avoid disputes.
Yes. An inventory of all items and amenities ensures clarity on what is provided and helps prevent disagreements at the end of the tenancy.
A well-drafted rental agreement ensures transparency, minimizes conflicts, and protects the rights of both the landlord and tenant. Following these guidelines can make renting out your property a hassle-free and rewarding experience.
