This city is a magnet for techies and job seekers from all across the nation, and as a result of this vast number of working-class people, the demand for rentals has gone up, driving up prices. If you are wondering why the cost of renting particularly in Bangalore is increasing by the day, then you are not alone. Bangalore is popularly known as the ‘Silicon Valley of India’. With ample opportunities present in the city, the cost of living has also seen a drastic spike, particularly rental prices. So, what is the root cause for such increased cost? In this blog piece, we will be looking at the various reasons behind this trend in the rental market in Bangalore.
What is the Reason for High rents In Bangalore Apartments
Bangalore has witnessed increased rental rates of approximately 15-30% in the past couple of years, especially in the sought-after residential districts. A large number of tenants are now considering whether renting a house is the best option or it makes sense to buy one instead. To begin, let’s explore the major driving forces resulting in the increased price.
Making Up Coming Up A Little Short
Sometimes, landlords are considered ‘the bad guys’ during these waves of the pandemic. They have been compelled to reduce rental rates to attract tenants. But how does this apply to landlords who seek to recuperate their losses? What are the ways they can accomplish it? But this creates problems for the tenants who have to deal with sudden high rent prices as a result of all this.
The Lack of Available Rentable Space
Additionally, the lack of supply was a significant barrier that the wave of the pandemic brought forth to Bangalore, along with many cities. Further new construction reduced the supply of residential units on the marketplace. All of these factors have increased pricing as the need for lower pricing has increased. Inflation aside, relatively less units have been added in times in places like Bangalore compared to other larger major cities which only exacerbates the issue.
The Hunger for a Better Life
With work loads becoming unbearable and wanting to have a better life, multiple tenants started to look at the high end for something a bit easier for them and more comfortable. But as demand increases the supply also increases. With up to about 30% increase in rental fees, an increase in people questioning if it is worth it to rent an apartment in Bangalore.
What is The Average Rental Increase in a Year?
As a Bengaluruidd, there are a number of rules to follow when dealing around the increase of rent, the measures set out would be beneficial to the tenants moving forward.
Commercial Buildings
Commercial rents are usually governed by Landlords and you’re typically able to charge rent increases of 5% 8% per year subject to the lease terms agreed upon.
Residential Buildings
Landlords on the other hand are restricted to raising the rents to a maximum of 10% once the expiry of the lease agreement has been accomplished for residential properties.It is mandatory under Section 106 of the Transfer of Property Act for landlords to tell the tenants beforehand about every enhancement in rent that they decide to make. Also, where improvements have been made or alterations done to the property, the rent can be equal to 15% of the cost of the improvement or alteration.
Tenant Rights in Bangalore
There are some rights that each tenant in Bangalore is entitled to, and that are important to ensure that peace is maintained. Such include but are not limited to the following:
- Right to Access Essential Services: Basic services, tenant’s water, electricity, and other essential services should be rendered without fail.
- Right to Pay Fair Rent: A tenant has a right to pay the reasonable rent and not be penalised with unreasonable and too much rent that they cannot afford to pay.
- Right Against Unfair Eviction: It negates the right of a tenant to be evicted without a cause which has been agreed upon in the tenancy agreement.
The Tenancy Agreements must be made in writing, signed, and registered as mandated by the Rent Control Act of 1948. The Model Tenancy Act states that a landlord must provide tenants at least three months’ notice to this effect if he intends to raise the rent. Furthermore, any security deposit shall be refundable within one month after all dues payable by the tenant have been settled.
Why Are Many Rental Spaces Still Vacant?
Many residential properties for rent in Bangalore remain unoccupied despite the fact that the amount in rent is not low. This is often due to disparities in the areas where the apartments are located, what they have, and their pricing. Due to better facilities, many of them like to stay in a place that is closer to where they work thereby cutting down on the time that they have to spend commuting to work. Some properties are Vacant because they do not fulfill the above criteria and tenants do not want to settle for a lesser quality of life.
Wrapping Up
The rise in rents in Bangalore is a consequence of multiple factors such as lack of supply as a result of increased demand and the landlords wanting to offset losses incurred during the pandemic. The correction, which many have described, is addressing the draconian prices at which many of the properties were leasing out at for almost two years. In order to advocate for their rights as renters, knowing the reason for such changes may assist tenants in adjusting to changing conditions in the market.
Answers On Topics People Search Most a.info: Frequently Asked Questions
1. What happened in Bangalore that has caused rents to go up?
A: The post-pandemic recovery has aided landlords in recouping some of their earnings lost due to low rental rates in the past – coupled with a strong demand and limited new housing projects – rental rates appear to be on the rise in Bangalore city.
2. Is it legal for landlords to increase rents without notification?
A: No, landlords cannot actually do this on a whim, as this depends on the lease agreement. A notification needs to be given, normally at least three months beforehand.
3. Do tenants have any protection in their right not to get evicted?
A: If they have a valid reason, landlords cannot just evict tenants even if they have increased the rental amount. Under the Rent Control Act of 1948 along with the other tenancy acts, a tenant has a right to be protected.
Get more details on Dream Location