Bangalore Rentals Guide

My wife and I decided to move to Bangalore after our wedding in May. Our biggest concern about our move to Bangalore was the archaic practice of landlords here insisting on extracting a security deposit equal to 10 months rent for leasing out any property.

From the beginning we were clear that we were not going to pay, what can only be described as an outdated and unnecessary travesty.
We moved here in July. Fortunately for us my wife’s parents live here so there wasn’t a real sense of panic about our search, ofcourse we did want to find our own place as soon as we could.
As the search began it became quite clear that the practice didn’t just influence more ‘traditional’, ‘old school’ and ‘uneducated’ landlords, as seems to be the misnomer amongst a lot of outsiders, it affected everybody across every imaginable background. The 10 month deposit seemed to be a convenient bandwagon for every kind of landlord from every possible background to jump on. I guess the lure of a sizeable chunk of money makes drooling idiots of us all.

We met potential landlords from every background, all demographics, every religion, creed, what-have-you and the response did not change; well neither did our resolve (given the luxury of the in-laws house, which made things a little easier). We heard all forms of justifications, reasons, litanies as to why we should part with such amounts of money as our well thought out arguments fell upon deaf ears. I will discuss these reasons in the sections below, but before I do I have to mention that we did eventually find a beautiful house, in the locality we wanted and we didn’t pay a 10 month deposit. Yes, it took us two months to find the place and negotiate like crazy but we persevered to ensure that tomorrow our landlord does not hold our lives ransom whenever it is that we decide to vacate the place.

I will now list out a step-by-step guide of what we learnt from our experience and what you should keep in mind when renting a house in Bangalore and are looking to pay no more than 2 month’s deposit.

The Search

  • When searching for a house be as diverse in your search as possible. Word of mouth and paper classifieds are good starting points but online is where the major volume of ads are palced. That being said, remember that beyond the big real estate websites also look at the smaller more multi-purpose ones like commonfloor, craigslist, sulekha, olx etc,.
  • Search for owner listed properties, it is always best to talk to the owner directly as opposed to through a broker, as brokers are generally unwilling to affect the norm in any way. And it’s always best to make your own case to someone who has the power to make a decision instead of convincing a broker first and then having to do it all over again with the owner. This ofcourse comes with an exception discussed later in this article.
  • Word-of-mouth contacts can often be best kind of contacts in respect of negotiating a deal because they can’t use any of the usual excuses as to why they want a huge deposit as they are ‘known’ to you.
  • Post your own classified ad on as many sites as possible. And specify clearly that you should only be contacted by landlords who do not require anything above two months’ deposit. This way, when they call you even if they are looking to negotiate, you will have the higher ground.

The negotiation

  • As stated before, always look to negotiate with the owner.
  • The process of negotiation will always have its own dynamics. The owners will have their own reasons, both reasonable and unreasonable, we have heard everything from ‘I need this money to pay off my loan’ to ‘My house costs x-lakhs, I need to secure it cause you sound like a shifty cheat (as if to say I could run away with it)’ but usually after a little fencing most Landlords will come down to this bottom line ‘This is how things are done in Bangalore and that’s why you should pay me’. As unlikely as it seems it is at this stage that you will usually be able to talk some sense into the landlord. Not often but on occasion you will have a reasonable guy who will see sense, or the lack thereof, in this practice when faced with a simple ‘other than the practice is there any other reason for you to demand this deposit?’.
    One piece of advice for this negotiation is anticipate all their questions and be prepared with responses e.g., for ‘I have to pay off my Loan” your response is the obvious “So, what happens when you have to pay me back?”. Similarly, all their arguments will have obvious holes so where you find a landlord willing to reason, be prepared. A gem I found in response to the ‘It’s always been this way in Bangalore’ response was, that the reason it was ‘this way’ in Bangalore was because the Karnataka Tenancy Act was an overtly tenant friendly law when it was originally brought into force, this was the reason that landlords decided to secure their properties with a 10 month deposit. However, since the 2002 amendment to this Act the law has actually been made far more balanced and both landlords and tenants have a much more equal relationship, thereby doing away with landlords to feel insecure and demanding 10 months deposit as security. At this point of time you will hear the sound of glass breaking, your future landlord has just dropped the glass of juice he was sipping.
  • Now we come to the exception of the self-negotiation. Where you don’t want negotiate yourself, for whatever reason, find a good broker, not someone who has advertised a house that you’re responding to but someone you have found independently. Assign your broker the task of finding you a place with the stipulation of paying only two months’ deposit. Incentivise, if necessary by offering the broker a higher commission than he would normally make on this kind of a rental.
  • When negotiating on the deposit never fall into the trap of higher rent against lower deposit, a lock-in penalty for any lease termination, unreasonable termination notices etc. Remember your rent and your deposit are two different things, as are your lease terms, you should link one with the other and set-off any consolations made for one against the other.
  • Ridicule and outrage are also two other good tools that were suggested to me when I was myself negotiating for the deposit. Laugh when the landlord suggests a 10 month deposit or react with complete outrage. Remember even if you don’t get the house, you have sent a message across that things are changing and that there are people out there who find the idea ludicrous. If a landlord hears this a few times from his market, maybe he will understand that it is he who needs to change.
  • Always quote examples of how everywhere else in the world people live in apartments with one month rent as security deposit. If your landlord is a little worldly and has lived in rented accommodation himself, he is likely to see some sense in this argument and relent.
  • Another strategy is to give your landlord the impression that you have never had to pay more than a 2 month deposit, even in Bangalore. Peer pressure can work wonders.
  • Typically, your chances of being able to negotiate with a landlord who has just bought a house or an apartment will always be better than with someone who has a place just ‘lying around’. The former will always have a greater need to rent out the property to start earning returns and paying back in loan. Ofcourse this can backfire, with the “Give me the deposit cause I have to pay back my loan” class of people. That notwithstanding it will still get you better results than people who do not have such pressures. So look for rental ads for newer apartments and negotiate hard with such people.

Red Flags

  • Usually avoid landlords that have dietary, religion or such restrictions. These people are generally closed minded and speaking with them is generally a waste of time and a test of patience.
  • Landlords who live in other cities and in rented accommodations themselves will sometimes acknowledge how they pay only a month’s deposit but since this is Bangalore and custom is custom, expect you to cough up a lung-and-a-half. Once something to this effect is said, understand that you are dealing with a troll devoid of logic. This guy is not interested in your argument, no matter how nuanced, fate has dealt him a lucky card and he is going to milk it.
  • I repeat – DO NOT set-off rent against a reduction in deposit.

Do’s

  • Always talk to owners directly (the exception above notwithstanding).
  • Post a wanted ad specifying your precise requirements on as many online and paper classified forums as you can.
  • Make a list, with numbers, of landlords who refuse to relent on the deposit front and post it on this website.
  • Once you have found a place remember to have clear terms in your lease regarding circumstances under which money may be deducted from your deposit and a notification/consent provision that requires your landlord to not deduct unilaterally. A 2 month deposit is still your hard earned money!
  • When paying rent or deposit always pay by cheque so that the transaction is recorded. This will help if your landlord has decided to be overwhelmed by the need to be dishonest and refuses to refund your deposit.
  • Always stamp your lease adequately. Remember an un-stamped lease cannot be admitted as evidence in court. Ofcourse you can do this at a later stage too, but you will have to suffer through the compounding charges.
  • If the lease is longer than 12 months you will need to get it registered.
  • Be patient. You will not find a house in a day or maybe even a week but if you persevere you definitely will.

I will conclude with a little story.

There were three monkeys who were part of science experiment. Their names were A, B and C. The scientists placed a bunch of bananas in the monkeys’ cage and a step ladder for the monkeys to be able to reach the bananas. However, every time a monkey tried to climb the ladder to reach the bananas the other two monkeys on the ground would get drenched in cold water. Eventually the monkeys on the ground co-related the two events and started pulling whichever of them tried to climb the steps.

In time monkey A was replaced by monkey D. And to his surprise every time monkey D tried to climb the steps the other two monkeys pulled him down. After a few more months Monkey B was replaced by Monkey E and a further few months later Monkey C was replaced by Monkey F. None of these monkeys had ever been sprayed with cold water yet due to their conditioning every time one of them tried to climb the steps the other two would pull him down. They didn’t know why they were doing this just that they were.

The 10 month’s deposit also has similar characteristics. As with every practice, custom, more it originated to satisfy a need that existed at that time, however that need has since long disappeared but sadly the monkeys continue to pull each other off the steps.

By: Saurabh Chauhan and Mansi Dharmraj

http://10monthsbeda.wordpress.com/

36 Comments on “Bangalore Rentals Guide”

  1. You have hit the target. But I think this lumpsum deposit mindset has been changed a lot. I have checked some 20-25 random classified ads out of curiosity and more than 20 of them have mentioned 5 months advance deposit and also “negotiable”. Seems to be a good change.

  2. That really does speak volumes doesn’t it RJ, that in Bangalore we think a 5 month deposit is reasonable because of the 10 month conditioning we have all been through. In another city no landlord would even imagine demanding 5 months rent as deposit.

    Is it an improvement and a good sign? Ofcourse it is. We hope to make it better. :)

    1. it is like chaos in bangalore. there are no standards? anyone asking any amount of advance :D

      i do not see any reasons why 1 month (ok 2 months) advance is not enough. The person who is asking for example 5 months advacne; does he or she aims at grabbing the whole amount and never return it to the tenant?

      my point is, what is the percentage of uneducated landlords in bangalore. give me a real estimate please…..

      1. By ‘uneducated’ I presume you are referring to landlords who ask for over 2 month’s rent as deposit, and yes they truly seem ‘uneducated’ in the truest sense.

        Purely from my experience I found over 80 percent asking for 10 month’s deposit right off the bat. Around a 1/3rd of these were amenable to some negotiation, but none was willing to go below 5 months. Of the remaining 20 percent, most wanted anywhere in the range of 5-7 months. Negotiable at best to 4 months. There were a handful open to the idea of anything else.

  3. And yes, advance grabbing has become an inevitable side effect. As has waiting for your advance to be returned indefinitely as the landlord waits for a new tenant and for his advance. The new tenants advance is given to you (best case) and a vicious circle begins.

  4. I saw couple of rental advertisements with aproximately 2 months advance. The one i decided to move in got filled by someone else- while i was making up my mind :(

    house ownrs started adopting this idea to get a tennant pretty quickly, even houses at locations unreachable by vehicle!

    1. Sorry about the fact that you missed it. But this is indeed an interesting perspective, especially the ‘houses unreachable by vehicles’ part.

  5. Today I was talking to the house owner’s son as he was asking me to post an AD in my company’s internal classifieds portal. Iwas talking about this article on this website and he said OK mention the advance deposit NEGOTIABLE.

      1. This is a very nice article, as i am just in the process of vacating and fighting on certain issues, after paying them 10 months advance.

        Phew…….. your article has given me some good hopes. i will certainly adopt this in my next house hunt.

  6. I’ve been staying in BTM from the last two years in the same house.. My Owner asked for 6 Months advance.. And i’ve been renewing it .. Feels good..

  7. Sir,
    Im suffering from the harassment of my house owner.We tenanted a house in 64, wilson garden 14th cross,10th main, 5 months back.
    After tenancy the landlord put certain conditions like
    1)Sweeping and washing the premises surroundings
    2)Washing vessels keeping it on floor outside the house,
    3)Not to use washing machine
    4)Cleaning the road where car is parked.Parking is not inside the apt and its road and they want us to sweep it everyday.

    We did some of these with our maid, though these are not mentioned in the rental agreement.
    Now they want us to vacate the house. I paid brokerage,shifting charges and for installation of phone and cable..I agreed to vacate and asked him to reimburse 50% of the expenses which he is refusing. I suffered close to 25k for this 5 months, other than the already high rent.

    Is there a way i can claim harrasment from the land lord

    1. Ganesh,

      To avoid these kind of situations you can typically have a lock-in clause in a rental agreement that ensures that neither party can terminate the agreement for a specified period (say 11 months). And incase there is a termination either party is liable to pay a months rent as compensation.

      As far as making you do all those things you have listed that is just plain harassment. That you should have either put your foot down and said no to or you could file a complaint and subsequently a civil suit against. In your case you can file proceedings before the Bangalore Mediation center and see if that takes you anywhere, it will save you the cost and time of litigation and will be a more amiable solution.

      Honestly though, the recovery of shifting charges if not mentioned in the agreement will be seldom recoverable. Let this be a lesson for the future whereby you can think of a lock-in clause to cover such eventuality.

      Hope this helps.

      Best,

      Saurabh

    2. STRAIGHT GO TO POLICE STATION AND LODGE A COMPLAINT AGAINST THE OWNER AGAINST HARASSMENT FOR VACATING THE PREMISES AND OTHER MATTER TOO AND ALSO LODGE A COMPLAINT WITH RENT CONTROL OFFICE. HE CANNOT ASK YOU TO VACATE HIS FLAT WITHOUT ANY VALID REASONS AND COULD CONTINUE TILL 3 YRS. OR JUST ASK HIM TO GO TO COURT AND FILE CASE WHICH COULD GO FOR YEARS AND HIS MOUTH WOULD JUST SHUT UP.

  8. So, seems like some positive news on the legislative front. Todays paper carries a story of the proposed Model Residential Tenancy Act, 2011 which will make it unlawful to charge any security deposit in excess of 3 months’ rent.

    This is a huge step, especially for people living in Bangalore.

    Wake up landlords to these winds of change.

  9. Hi Ganesh, thanks for the update. I am robbed for more than 8 years in blore by these and landlords…..Changed more than 5 houses. Paying deposit for 10 months seemed ok for me intially…..but at the time of vacating the house, they would literally pay you half of the total showing you some unnecessary damages, paint charges, cleaning charges aand all which should not be more than 5000 in total…..But they can eat up half of the deposit given………Scene of Bangalore Tenancy….

    This website rocks….

    Many Thanks to Ganesh and Priya for continued support…

    You both should start a consultancy firm or something….

    Cheerssssss…

  10. Hi,
    I am actually planing to move to Bangalore next month with my wife.
    I dont know anyone there. And the office is on ITPL road.
    Any chance that you might know os a house on rent 1 or 2 BHK with less deposit??
    Thanks in advance.

  11. Iam real estate agent in bangalore my moblie no is [removed] please cintact for rent,buying site and selling site, lands and apartments

    Thanking you

  12. This article hits the nail on the head – people like us who cannot afford to buy a house have had to suffer the greed of Bangalore landlords for years! Thanks for the great advice on how to tackle the situation!

  13. I wonder how many people are aware of the new Tenency Act, 2011 – according to which it will be ILLEGAL to ask for more than 3 months security deposit? There is a loophole – “unless agreed on otherwise” but this definitely coul dplace unscrupulous landlords in a bind if the victim should choose to bring it to the notice of authorities!

  14. I wonder how many people are aware of the new Tenancy Act, 2011 – by which it will be ILLEGAL for landlords to charge more than 3 months security advance against rent? Of course there is a loophole – “unless agreed on otherwise” but now at least one has recourse to the law, if it is found that a prospective tenant was refused a home on grounds of refusing to pay more than 3 months security advance – and then the landlord gave it to someone who paid more! Once a few such cases are registered against Bangalore landlords, the others will fall into line….

    1. Is this true ? How can we use this clause to negotiate with the tenant ? Are they aware of the same ? How can one prove to them ? Please guide.

  15. I live in bangalore for 15 years and have seen how the greedy nature of land lords have increased over the years. In places like HSR Layout, Jayanagar, BTM Layout etc. 10 months deposit is non-negotiable. The unwritten policy in these areas is ‘if you don’t work for a MNC don’t live here’. We need to keep in mind that government will be always pro-landlords, so all this New Tanancy Act 2011 are not going to help the tenants in anyway. The government will make sure that there are enough clauses in such Acts for the owners to harass the tenants.

  16. According to the Model Residential Tenancy Act 2011, Chapter 3, No.12 “it shall be unlawful to charge a security deposit in excess of three times the monthly rent”. Schedule III Part A of this act also says, “White washing of walls, painting of doors and windows to be got done by the landlord”. But somehow we don’t see this happening, especially in Bangalore. Most landlords asks the tenants to pay for white washing and painting the house, which comes under structural repairs according to the above mentioned act.

    1. THIS SHOULD BE STRONGLY OBJECTED AND TAKEN OUT FROM THE AGREEMENT ITSELF. NO TENANTS SHOULD AGREE TO THIS CLAUSE. THE RENT IS INCLUSIVE OF MAINTENANCE BY THE OWNERS EXCEPT MINOR. TENANTS SHOULD NOT VACATE UNTIL HE PAY BACK YOU FULL AMOUNT WITHOUT DEDUCTING ANYTHING OR JUST LODGE A COMPLAINT FOR WRONG RULES.

  17. here everyone is mentionting the problem of the tenents what about the house owner. He own the house and he will decide how much he should get on Rent.If Tenents are ready for that those people only should go to him. I own two flat i do give it for rent. But if the person who is comming to enquire all these things which is listed in the law then defentilty i will not give my flat to them. you tell me why should i give? Every one should change there mindset that is not goving to happen in india.I Like the way you mentioned the Deposit should be two months. I am giving furnished flat for rent and rent may be 12000. If i quote just 20000 as deposit then where is the security for the items i am providing so i will charge more. I do not this it is a wrong anywhere.And i am as an owner i can tell you THERE IS NO FREE LUNCH. IF YOU CAN AFFORD THE RENT THEN ONLY TAKE THE HOUSE FOR RENT NO OWNER IS BEGGING ANYONE TO TAKE THERE HOUSE FOR RENT!!!!!!!!!!!!!!!!

    1. @Dinesh, you are the typical a$$holes in bangalore. And you are the reason these laws are being made. Count your days to jail because these are going to be very strict in Bangalore especially. keep your realestate blackmoney ready for bail.

    2. Mr.Dinesh is showing sheer arrogance and looks like have lost humanitarian sense. may be this is the result of owning two flats in bangalore. Just because owning things don’t make anyone above the law. Lets be people first, thats more important. Somehow greediness rules in all our cities, and people are loosing value for fellow people.

    3. “NO OWNER IS BEGGING ANYONE TO TAKE THERE HOUSE FOR RENT!!!!!!!!!!!!!!! ”

      Mr.Dinesh, time to beg can come to anyones life at anytime. I just want to mention that, there was a time when owners did begged. In 2008 when the recession was hitting badly, many owners became so soft suddenly. The owner of the house where i lived at that time pleaded with me not to vacate the house at that time. He was even willing to wave off the 5% increment, but wanted me to stay in his house. So please be careful in making such overconfident, arrogant statement. Time to beg can come anytime.

    4. Dinesh, Practice of taking huge amount of rental deposit is an unethical, shameless and greed practice. Many landlords even does not return the amount fully at the time of vacation. Deducting amounts for various silly reasons. God never bless such people. And also meaningless to keep god’s idol at home.

  18. According to the Model Residential Tenancy Act 2011, Chapter 3, No.12 “it shall be unlawful to charge a security deposit in excess of three times the monthly rent”. Schedule III Part A of this act also says, “White washing of walls, painting of doors and windows to be got done by the landlord”. But somehow we don’t see this happening, especially in Bangalore. Most landlords asks the tenants to pay for white washing and painting the house, which comes under structural repairs according to the above mentioned act.

    1. How do we complain against the 1month rent deduction for whitewashing etc? Probably I will report the landlords name as they are violating income tax anyways

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