3 Ways in Which a Lease could be Terminated

In India, the landlord-tenant association is regarded as a jural relationship and is regulated by the provisions of the Transfer of Property Act, 1882 (Act). When it comes to a landlord/tenant connection, the parties are typically observed as a lessor (landlord) and lessee (tenant). The contract under which the landlord-tenant relationship is tied is a lease agreement. 

A real estate lease contract is a binding agreement between you and your landlord. Thus, if you feel the need to prematurely terminate your lease, there will be consequences – legally and financially. There are many reasons that can be used to end a lease, but the majority of them will not offer you legal relief from your landlord. 

Occasionally, after signing a rental agreement or lease, a tenant may feel the need to leave the rental unit prematurely for several reasons. In the same way, a landlord can terminate the lease under specific circumstances. It is vital to adhere to state laws, as well as specifications that are listed within the lease, for delivering notice of intent to end a lease. 

Usually, lease termination in India can happen for a variety of reasons and by both the parties – landlord and tenant 

Termination of Lease by Tenant 

Since a lease is bound by an agreement, tenants have to adhere to the length of the tenure specified. This means that they are accountable for paying the rent stated during the duration of the lease. There are exceptions to this rule, especially if the landlord breaks or violates the lease. 

If the landlord breaches the terms of the lease, particularly health and safety codes, the tenant may be able to leave without giving notice or providing less notice than needed. In case there is a natural disaster or significant impairment to the property, it prevents the tenant from continuing to stay in the rental unit. However, if the tenant violates a lease without a legally protected reason, the landlord is entitled to sue for damages.

Termination of Lease by Landlord 

A landlord is able to legally end a lease if the tenant violates the terms of the lease or has broken the law. The violation by the tenant needs to be significant like late rent or having a pet despite the rule stating ‘no pets allowed on the premises. Other violations of the law, like selling drugs on the premises also justify the landlord’s decision to terminate the lease. 

The landlord needs to first dispatch a termination notice to the tenant, thereby making it clear that the tenancy has ended. The tenant may be offered time to amend the violation, by paying outstanding rent, for instance. There will be a notice that declares that the tenant needs to move out of the premises or risk eviction. 

Issues Pertaining to Security Deposit 

Generally, the landlords have about two weeks to one month to give back the tenant’s security deposit amount after the lessee vacates the rental premises. Landlords may subtract from the tenant’s security deposit for legitimate reasons. Deductions need to be shown in a written document and itemized, and the payment needs to be refunded for any deposit balance. It is vital to check with the landlord if the deductions are not accurate. Any agreement reaches needs to be logged in writing. 

In a nutshell, there are many ways in which a termination of a lease agreement India can happen. If you wish to know the leasing status of many companies across the country, check out CRE Matrix and its many tools for it is the leading real estate data analytics company India.

For more such exciting analysis and details on real estate, visit our website www.crematrix.com.

7 Crucial Points to Keep in Mind before Signing a Rental Agreement

Renting a home in India can be quite complicated because of the research and the planning required. If you wish to rent a home in India, it is extremely vital that you’re aware of what to look for prior to signing a rental contract

There are numerous elements that can be included in a rental agreement, and not all of them are beneficial to the tenant. In this article, we will talk about some of the most vital things you need to check before signing a rental agreement in India. 

What the Rent Includes

You need to thoroughly check the rental contract. Generally, the monthly rental amount typically comprises utilities such as electricity, water, and gas. However, be sure to check if it also contains maintenance charges and property taxes. 

Kinds of Tenancy

There are two kinds of tenancy agreements in India – the leave & license agreement and the lease agreement. A leave & license agreement consists of a duration of 11 months, after which it can be renewed. A lease agreement has the lease tenure for up to at least 12 months and can be renewed once the term is over. 

Notice Period & Penalty

If you’re looking at homes for rent India, one of the most important things to look at would be the notice period and penalty. The majority of the rental agreements have a minimum notice period of 30 days (one month). If you wish to leave earlier, make sure to check if there is a clause that talks about an early exit fee. Generally, one month’s rent would be charged as a penalty. 

Rent & Deposit

It is important to check the monthly rent amount. Ensure that the rent is budget-friendly for you and that it is light in your pocket. It is also imperative that you check the amount for the security deposit. This is generally one month’s rent but it can change depending on the landlord the agreement can differ depending on the landlord. The contract will state the monthly rental amount and the security deposit. Be sure the rental amount is aligned with the relevant market rates. 

Register the Rental Agreement 

Once you have signed the rental contract, ensure that it does get registered at the office of the sub-registrar. The fees for the registration are generally around 0.25% to 0.50% of the entire sum of the agreement. 

Check for Lock-In Period 

The majority of the contracts have a lock-in period of approximately 3 years. This means that you cannot exit the property before this period is over. 

Duration of Rent 

When you’re looking at available flats for rent in Mumbai, it is imperative to look for the length of the lease in the rental contract. The tenure of the lease is generally around 11 months, after which it can be renewed. Be sure to check if there are any clauses that state an escalation in the rent after the initial first year. Make sure to enquire about it before you sign anything. 

If you wish to know more about the various residential projects by a number of developers across India, then subscribe to CRE Matrix, a leading real estate data analytics company in India, as they can offer several tools to facilitate this. 

For more such exciting analysis and details on real estate, visit our website www.crematrix.com.

Real Estate 101 – A to Z about the Lock-In Period in a Leasing Contract

Commercial properties such as office buildings or warehouses can be observed as excellent investments. This is because they deliver high yields, are reliable, and escalate over time. It is well-known that location affects the value of a property. If it’s a commercial property with a high degree of accessibility, it is natural for the asset to make a high rent. An important but usually ignored part of CRE investments is generally the lease and lock-in periods. 

What is a lock-in period? 

Lock-in periods belong to a part of the lease contract. The significant bit is – while landlords are tied by the lease duration, lessees are bound by the lock-in period. If a property has a lease term of 9 years and a lock-in period of 3 years, the tenant needs to continue staying in the space for 3 years or pay the rent for the lock-in period if they choose to shift basis. 

Why is a lock-in period significant? 

A clause with the lock-in period in leasing agreement India is extremely important because it makes sure your returns are steady and guards your investment against struggling. Even if the lessee decides to abort the ship or the market conditions go bad for some reason (a pandemic, for instance), a decent lock-in period can be a saving grace in this scenario. It gives you more time to look for a new tenant or wait for the market to bounce back while still providing you with a return on your investment. 

So, what’s a ‘good’ lock-in period? 

In commercial real estate, the lock-in period in leasing can change from 3 years to anything like 9 years. That’s a substantial range and it generally comes down to the kind of asset and tenant in question. For instance: Firms that are into manufacturing need an industrial space that they can personalize to the last bit. They seek out longer lock-in durations (occasionally 15 years or more), since their work floor is regarded as the most stable portion of their business. 

White-collar companies require offices. They need desks, chairs, and some computers, and their necessities are met. This is why these companies want lock-in periods that are on the shorter end of the spectrum (lesser than 5 years). When it comes to warehousing, the lock-in periods typically tend to remain within 5-9 years. 

When you’re deciding to invest in commercial real estate, do keep in mind the type of property and the lock-in period it has, irrespective of the tenant. If the period is too less (e.g. lesser than 3 years), the tenant might not consider sticking around. If you’re not able to renegotiate for a longer lock-in with the tenant, it is best not to go for the property.

On the other hand, if the lock-in is too long, you have to pay the rent that’s lower compared to the market average, which is still fine as long as you are making stable returns. Several other intricate details need to be taken into consideration when you’re deciding to invest in a commercial space in India

CRE Matrix is a leading company that offers real estate data analytics India. It offers elaborate details about the leasing status of numerous businesses across the industry. You can take a look at what their leasing agreement entails including the lock-in period clauses of those contracts. 

For more such exciting analysis and details on real estate, visit our website www.crematrix.com.

4 Things You Need to Know Before Signing a Contract for Leasing Commercial Space

Signing a lease is a significant milestone for a new business owner. Whether you’re launching a store or shifting to a new office space or leasing out facilities for production. At some point, you’re most likely going to have to set aside some space for your business. 

Once you have zeroed in on the space, signing the agreement often feels like the final step before you can shift in and concentrate on running your business. But similar to the majority of other legal agreements, a business lease is a vital piece of document that needs thorough research. 

The fine print in a commercial lease is extremely imperative. There are two basic steps that need to be followed prior to signing a lease: 1) Conduct a thorough search and 2) Need to know of general statutes that are included in business leases. 

Once the basic pricing and term structures have been established, it’s time to understand some of the less-obvious details. Here are a couple of things a business owner needs to be aware of before signing a leasing contract India:

Transfer Structure: Determine how your lease will get transferred if you wish to leave the space or your business shuts down. Typically, there are two structures for transferring a lease: assignment of the lease and subletting. 

Assignment of the lease refers to the fact that the complete lease is reassigned to a new tenant. Subletting happens when an existing tenant keeps their name on the lease but is given payment from the new tenant and then pays that money to the landlord. 

In both scenarios, you generally have to specify prior written consent before transferring the lease in the leasing agreement.

Personal Exposure: In a few cases, you may be needed to sign personal guarantees when you are leasing commercial space India. These contracts mean you’re personally on the hook for features of the lease even if your business defaults. Get legal counsel to negotiate this part of your agreement. If possible, you would only want your entity or legal business to take on the gamble when you’re signing a business lease. 

Holdover Rent: It essentially refers to a rent increase when the tenant continues to stay even after the lease has ended. For leasing office space Mumbai, a number of agreements, have a clause where it’s stated that, in these scenarios, businesses are accountable for up to 250% of their standard rent payment on a monthly basis. So, if you stay beyond your allotted time, it could cost you a lot of money. 

Non-disturbance Agreement: In numerous cases, if the landlord is not able to pay the mortgage on the property, the business will still be evicted, even if their making all of your payments, With a non-disturbance agreement, if this happens, you will be allowed to stay and continue paying whatever entity has seized control of the building from your landlord. 

In a nutshell, these are the five things you need to be aware of before you sign a lease agreement. Check out CRE Matrix, a leading real estate data analytics company India, which allows you to take a sneak peek at the lease agreement status and other details of numerous businesses across the country. 

For more such exciting analysis and details on real estate, visit our website www.crematrix.com.

How to Apply for Loan to Buy Commercial Property in India

Getting a loan for commercial office space is not the same as acquiring loans for a residential property. Several businesses seek to get a loan for office space but do not know how to go about it. Acquiring a loan for a home is more popular, better, and more extensively given by banks and financial institutions. On the other hand, acquiring a loan for commercial space is difficult and the know-how of people in this regard is also rather restricted. 

People tend to get overwhelmed when it comes to applying for loan for commercial property purchase India. Even if they are aware of the minute details of home loan application procedures, they seem to find funding office space or commercial units tough. Commercial real estate transactions can be either for office spaces or maybe even retail outlets like stores or shops. They could be ready to occupy or under construction. 

Banks tend to be extra wary in granting loans for commercial property purchases. They are overly cautious commercial spaces that are currently being constructed. So, it is recommended that prior to applying for a loan, always check with your bank about the financing criteria and other requirements. 

Here is a guide with all the details that investors need to keep in mind before applying for a loan for commercial property purchase. 

First, you need to be eligible for applying for commercial real estate loans. Eligible applicants comprise both salaried and self-employed professionals. The latter category contains doctors, architects, engineers, chartered accountants, and lawyers. Traders, entrepreneurs, and contractors can also be eligible to apply for loans in this category.

Here’s a checklist to qualify for applying for a loan for commercial purchase.

  • Make sure that the builder comes with a strong background and profile with a successful track record of delivery.
  • Check the Title Deed of the commercial purchase. Make sure that it meets all official regulations and civic approvals. 
  • Ensure that you have a fair valuation of the commercial space in mind while asking for a loan. 
  • You need to have a good financial standing with a decent credit score, adequate monthly income, and other credentials. 
  • The age of the property needs to be in adherence with the criteria of the bank. 
  • Your commercial property needs to meet the minimum space criteria of the bank. 
  • All technical specifications of the commercial property need to be in place, with complete approval from the Government and other concerned and relevant authorities. 

Once you have met the eligibility criteria, you can expect to get your loan approved with a reasonable interest rate. Loan for commercial property interest rates is generally up to 4-5% more than interest rates on residential properties, contingent upon the borrower’s credit history. 

You can take the help of CRE Matrix, a leading real estate data analytics company India that can give you all the insights on loans that are taken for commercial properties across the country by numerous companies and the banks/NBBFC/funds that provided the loans to them. Users can evaluate and compare loans for commercial properties and do so much more on CRE Matrix platforms. 

For more such exciting analysis and details on real estate, visit our website www.crematrix.com.

What Are The Different Types of Tenancy Agreements in India?

When a property is rented out, a Tenancy Agreement is essential to specify the terms and conditions, that have been approved by both concerned parties and to describe the details of the landlord-tenant relationship. In case of a disagreement, it could end up becoming a basis of conflict. 

What is a tenancy agreement?

tenancy agreement India is a legal document that elaborates on the terms & conditions of a lease and rent partnership between two people. A tenant is an individual who is allowed to use a property under the rental agreement terms

There are several kinds of agreements when it comes to renting or leasing a property. While a rental contract is controlled by the Rent Control Act, the Lease & License agreement is regulated by the Indian Easement Act. Landowners need to know that if the tenant is a danger to society and there is no Tenancy Agreement in place, the landowner can be held responsible.

Let’s look at the different kinds of tenancy agreements in India:

The tenancy agreements in India are categorized into three kinds:

  1. Rent Agreement 
  2. Lease Agreement 
  3. Leave & License Agreement

Rent Agreement

A rental contract is a legal agreement between a property owner and the prospective tenant who wishes to take temporary possession of a particular property. The agreement showcases information, like the name of the property owner and the tenant, description of the property, amount of rent that was approved, late payment fee, grace period, security deposit amount, facilities that the tenant is allowed to use or not, provision and right of parking, property insurance, maintenance & repairs, among many others. 

Whether it is a commercial rent agreement India or a resident rental contract, they are generally for a shorter duration, typically 11 months in India. A rental contract is a brief concord, thereby allowing a trouble-free settlement between the two concerned parties. 

Lease Agreement 

lease agreement India is typically needed in case of a longer occupancy period. When the landlords wish to avert the fluctuations in sustainable income, they prefer to have the property on lease. The lease agreement is regarded as a contract between the landlord and tenant, where the tenant is issued the right to use the specific property for the computed time frame (usually over 12 months). 

Generally, a leasing contract connects the landlord and the tenant for an approved time span, as opposed to a rental contract. A few leases are for 99 years. Additionally, a lease generates interest in the property, is transferable, and creates inheritable rights. 

Lease & License Agreement 

The Leave & License Agreement is regulated by the Indian Easement Act 1882, and it is not the same as lease and rent agreements. This specific type of contract is a document via which the property of the Licensor is used by the license holder. However, the property is given on the basis of the Lease & License agreement and not on the basis of the tenancy. When no such permission exists, the right for the property would be deemed illegal. 

CRE Matrix, a leading real estate data analytics company India, offers leasing & rental status of numerous companies across sectors on a pan-India basis. 

For more such exciting analysis and details on real estate, visit our website www.crematrix.com.

3 Elements that Make Micro-Markets Attractive

In the real estate sector, micro-markets are referred to as subdivisions between geographical regions that have their own separate and significant characteristics. These localities generally have properties at present market rates, thereby making them more lucrative to the majority of the city residents who are not seeking extravagant investments.

When a city or area claims its own market with its rates, location, and viability for investors, then the micro-market level is actually where the purchase decisions are carried out. Areas from Andheri-Goregaon to Dahisar in the west or Ghatkopar-Chandivali to Bhandup-Mulund in the central-east corridor are rising as new mini-business hubs resulting in the rise in demand for homes to live closer to workplaces. 

Let’s take a look at 3 key elements that make micro-markets India attractive to those who wish to purchase properties for commercial or residential purposes: 

Excellent Infrastructure & Connectivity:

Historically, it is seen that proper development of infrastructures such as metros, railways, and roads has demonstrated an optimistic effect on the real estate attributes of a city. When commercial or residential properties are located near strategic connectivity points, it does lean towards commanding a higher valuation. 

When you take into account the swift development of infrastructure, these emerging micro-markets in Mumbai are developing rapidly as realty hotspots for residential or commercial projects. Companies are now moving their workplaces, thereby helping their employees to save time on their daily commute. This is why a 2 BHK flat in Andheri tends to be rated higher as Andheri is a micro-market in Mumbai with it being a hub for residential and commercial properties. 

Fair Real Estate Rates 

The emerging micro-market belt of suburban regions continues to be a hot favourite among buyers who are seeking to be a part of India’s financial hub and economic development. The transportation infrastructure economies have often demonstrated a positive effect on a city’s property market as commercial and residential properties near transportation hubs have an inclination to ask for a premium rate. 

Moreover, all the transport network actions boost the adjacent real estate micro-markets. These regions also provide enhanced physical and social infrastructural facilities like hospitals, schools, and shopping malls which have added to the increased popularity of these areas. 


Budget-friendlyhomes or commercial properties can play a big role when it comes to determining the viability of a micro-market. The newer micro-markets are providing apartments that are lighter on the wallet along with a host of amenities and great infrastructure to become a buyer’s paradise. 

Developers are coming up with projects that offer homes in the range of s 1 Crore to 2.25 Crore bracket and are part of expansive townships with existing social & physical infrastructure along with a sprawling space for greenery and a host of modern amenities. 

In a nutshell, these are some of the factors that can make micro-markets incredibly attractive and lucrative to home buyers as well as for commercial purchases. CRE Matrix is a leading real estate data analytics company India that uses micro-markets to analyze real estate data from numerous companies/brands across industries on a pan-India basis. 

For more such exciting analysis and details on real estate, visit our website www.crematrix.com.

Key Differences between Lease & Rent: What Should You Opt For?

How many of us were aware that leasing and renting is not exactly the same thing? Thanks to their many similarities, it’s easy to assume that both the terms are one and the same. Until you enter into a leasing or rental agreement India, you will not be able to spot the subtle differences between the two concepts. Even though the two words are frequently used interchangeably, leasing a commercial space is not the same as renting it. 

In this blog article, we aim to educate on some of the key differences between a ‘lease’ and ‘rent’. 

Lease vs. Rent 

A rent contract, a document signed between the tenant and the landlord to make the renting process official, can either be a lease or a license. Whether a tenancy could be carried out via a license or a lease agreement is fundamentally decided by the tenure of the tenancy. 

Under the lease, the landlord is required to transfer the right to make use of the property, to the tenant for a specific period of time in return for the rent. Leasing is typically observed more in the commercial real estate space sector in India. On the other hand, a rental agreement India is regarded as a legal contract where the landlords give their property to a tenant for residential/commercial use for a shorter period. 

Key Differences between Lease & Rent

Here are a couple of differences between leasing and renting based on the following factors:

Parties Involved: When you enter into a lease contract India, the parties involved are referred to as lessor and lessee, whereas in a rental agreement, the relevant parties are known as a landlord and tenant. 

Time Span: A lease is generally agreed upon for a longer duration, i.e. 6-12 months or more as decided by both the parties. On the other hand, rent is for a shorter time frame, i.e. on a monthly basis or it can be up to 11 months. 

Repair Expenditures: The monetary expense for maintenance and repairs has to be borne by the lessee whereas when it comes to a rental agreement, the tenants need to pay for this expenditure. 

Terms & Conditions: In a leasing contract, the terms and conditions cannot be altered once they have been signed and agreed upon by both parties. Nevertheless, if both the lessee and lessor decide to revise some portion of the agreement they will have to get into a lease amending the contract. On the other hand, landlords can modify the terms in a rental agreement arrangement by giving a head’s up to the tenant. 

To sum up, these are four key differences between leasing and renting a residential or office space in India. You can use CRE Matrix – a leading real estate data analytics firm in India – to give you a detailed breakdown of the leasing and rental status of numerous brands/companies across the country. 

For more such exciting analysis and details on real estate, visit our website www.crematrix.com.

Significant Clauses in Commercial Lease that Tenants Need to Know

When you sign on to a commercial property on lease, a contract for the same needs to be carefully executed and planned. There is generally a massive rental outgo in commercial establishments and therefore, the premises to be taken on rent needs to be completely checked. The rental agreement becomes a vital part of your business and the conditions therein will affect your work and operations, as long as you are on those premises. 

Let’s look at some of the important clauses in a commercial lease India that a lessee should be aware of:

Competitor Clause: It’s imperative that you try to get a competitor clause in the leasing contract. This clause will prevent the landlord from renting out space in the same building, in which you are shifting, to your competitor. This can work out to be extremely useful, especially if you’re a retailer. 

Concessions in Rent: You need to find out if the landlord can offer specific relaxations, such as waiving the rent for the initial one or two months of the lease duration. Landlords can be flexible if the premises have been available for quite some time. Other relaxations can comprise sharing of renovation expenses or a paint job for the premises that will be paid for by the landlord. 

Gross Rent Lease or Net Rent Lease: There needs to be sufficient clarity between your landlord and you, about the elements other than the rent, such as maintenance fees, property tax, insurance, and expenditures towards common areas.When it is about the gross rental deed, you will be responsible for paying the rent and other relevant expenses. In a net lease deed, you will only be entrusted with the task of paying the base rent. 

Lease Termination Conditions: This is a significant clause in commercial lease. Inspect the conditions, under which the landlord can end the lease, as they can often be tight. One needs to plan for circumstances where the building is sold by the landlord, while the lease term has not finished. 

Lease Renewal Clause: Lease tenure of one or two years will offer you the flexibility, especially if you own a small business, to move out for expansion or to better premises when needed. Nevertheless, there needs to be a clause to renew the agreement, after the initial one or two years, at the same rent or a hike that has been agreed upon mutually. When you take a commercial space on rent, your leasing agreement needs to have a proposed escalation in rentals in writing, in case you opt to renew the contract. 

Security Deposit and its Return 

There will be a set sum that you would have to deposit with the landlord as security. This security deposit will be equivalent to two or three months’ rent. You need to try and negotiate the amount you have to keep as the security deposit. If you find that there are numerous vacant establishments in that neighborhood or if the landlord is not corporate, there is more scope for negotiation to work. Tenants need to also inspect the conditions relating to the return of the security deposit. 

In a nutshell, these are a couple of the significant clauses in a commercial lease every tenant should be aware of. 

CRE Matrix will give you all the leasing data including clauses across businesses and sectors. 

For more such exciting analysis and details on real estate, visit our website www.crematrix.com.

Real Estate 101 – All About Commercial Property Leasing in India

The real estate industry is regarded as one of the most universally recognized sectors. It contains four sub-sectors including housing, hospitability, retail, and commercial. The evolution of this industry is accompanied by the development in the corporate setting and the need for office space as well as urban and semi-urban accommodations. 

In India, the real estate sector is considered to be the second-highest employment generator, following the agriculture industry. It is anticipated that this sector will gain more non-resident Indian (NRI) investment, both long term as well as short term. Bengaluru is believed to be the most preferred property destination for NRIs currently. 

While there is a high demand for purchasing commercial properties, there is a rise in leasing commercial lease India as well following the reduction in the severity of the pandemic. 

What is Commercial Leasing?

commercial leasing India is essentially a lease that is utilized for a commercial property where a company would conduct its business. These leases comprise an array of unique terms, including tasks connected to the upkeep of the property. 

Unlike residential leases which are quite easy to comprehend, a commercial lease can be a little more complicated as it comes with numerous terms and conditions. Moreover, commercial property on lease is notonly given out to people but also to entities like the sole proprietorship, corporates, or HUF. 

Kinds of Leasing Structures in India

On a broad level, there are roughly two main types of leases in India:

Financial Lease

It refers to a long-term duration lease. It encompasses the capital outlay in addition to the required rate of return on funds for the duration of the lease. In this case, the lessor plans to cover the expenses of the capital of the property and also wants to acquire some required rate of return. This financial lease cannot be canceled and the lessee has to make several payments in order to use the property. 

In this case, the property rights continue to stay with the owner during the lease period. However, when the lease is about to expire, the tenant party is provided the choice to buy said property by paying the residual money. The amount is generally estimated at 10% of the value of the property or less. 

This kind of lease can be observed as a loan. The lessee will keep paying the lease rent and pay the remaining amount in the end to own the property.

Operating Lease 

When it comes to operating lease, the legal ownership of the property remains in the hands of the owner of the property. The owner only spreads the right to use his property for economic uses or business purposes for a pre-defined duration of time. 

Once the duration of the lease is coming to an end, it can be determined whether to lengthen the lease and continue to allow the usage of the property to the lessor or terminate the contract. In this case, the ownership always lies with the true owner throughout its run. 

If you wish to look for commercial properties for rent, you can take the help of India’s best real estate data analytics company – CRE Matrix – that allows stakeholders across different industries to view significant leasing data of various companies.