Non-residents of India pass sleepless night if they own property or land in India. Its maintenance gives rise to unlimited worries which abandon their sleep. The leading query that frequently catches countless NRIs its prey is tenant management. Lending a house is quite easy but keeping a watch over tenants time to time is the toughest for all. Why is it so? Against this question of yours, I have some major reasons which drag NRIs to complexities and dilemmas if they hire a tenant:
Major problems faced off by the NRIs after leasing their property:
- Misuse of his property
- His refusal to vacate the premise
- Delay or non-payment of the rent
- Denial of tenant to clear the outstanding rent
- Denial of the tenant to pay maintenance fee on time
- Tenant’s indulgence in suspicious and illegal practices
How To Compute Rent?
All the foretold queries are stimulants of worries in the mind of the property owners. So, the NRIs should be well known of the tenant management. Deciding rent of the NRI property is the initial step of this management. It is common sense that the migrant, who stays cut off from his property for long time, can never be knower of the prevalent rental amount in the locality. So, here are the listed steps to help him deciding the rental amount of the NRI property:
- Since flats in a particular area are inform in structure and area, so he can ask the rent of the rental flat next to his flat or in the neighbourhood.
- Independent house owner NRIs should check the prevalent rental rates from the property dealers or owners. Infrastructure, locality, area, amenities and facilities do matter a lot.
- Independent property owners should compute 2.5% or 3% of their property’s capital value in order to fix the rental amount as per square feet.
Posting Ad for Accommodating Tenant:
Once you have decided to lend your NRI property on rent, you can take help of print media to post an advertisement as ‘house on rent’ or you can rope in to online portals for winning tenant. There you can post some images of your house and locality along with the rental amount to lure tenants. These tricks sound simple but are highly effective if you execute them.
Lease Agreement or Rent Agreement:
If you are unaware of lease agreement or rent agreement, you can click on some portals providing rental agreement assistance under property management services for NRIs. Let I clarify what is lease agreement. It is a legal document which binds the NRI and tenant to abide by the mutual agreement over certain conditions. If any of them violate the terms and conditions, this document will play crucial role in litigation. So, it is better to draft it and keep it secure. You must be wondering what does it carry which makes it so crucial. Check out the content it has:
- Name, address, father’s name of both parties.
- Verification of the fact that the lessor is legal owner of the person or a person duly authorized by him.
- Clear mention of rental amount, including or excluding maintenance.
- Date of revising rent and quantum of it.
- Mode of the rental payment.
- Interest over deferred payment, if any.
- Payment of utility bills, like electricity bill, phone bills and water charges etc..
- Furnishing charges to be endured by whom.
- Purpose of tenancy, either commercial or residential.
- Process of premature termination of the tenancy.
- Apparent mention of all inclusive services, like gym, swimming pool and car parking etc..
- Security amount, if refundable or non-refundable.
Registration of Rental Agreement:
Under section 17 of the registration act of 1908, registration becomes mandatory of the rent if the property is to be leased for more than 11 months. Stamp duty and registration fee are asked to be paid.