I am a regular reader of Real Estate Reporter particularly the columns, frequently asked questions and questions & answers on property matters. Recently I was transferred to Mandya and negotiated a house for rent. The owner insisted on an agreement of 11 months only whereas I wanted for three years. Please let me know, what is the secret behind this eleven months agreement?
- by Suresh Babu, Mysore
According to the Transfer of Property Act any document which creates interest or right in the property for more than one year or more, or the value of which is more than Rs.100/- needs registration. Further stamp duty payable on such documents is also more.
To avoid the payment of stamp duty and registration charges, both the owners and tenants avoid rental agreements in excess of eleven months.
You may agree for rental agreement of eleven months with an option to renew the agreement for another eleven months twice, making total tenancy period of 33 months.