A Good Rental Deal In Mumbai
When a housing society goes in for a redevelopment, the process of relocations has its share of birth pangs, the feeling of coming back to a brand new home is overwhelming, yet the tough part remains for relocating to another location or another building for the interim period for 2 to 3 years approximately.
You need to evaluate the time frame depending on the redevelopment of the society and possession timelines declared by the developer in the MOU with the society. This is very crucial as the Leave and License agreement which you will sign in Mumbai will be based on the term your house gets ready.
We bring you a very simple guide which will give you a few insights on moving into a tenanted apartment while your home is being built.
- Find the Location
The rental market in Mumbai in a lot of locations is still undervalued, for example, any location, which is far away from any train station or highway or basic infrastructure, can get you a great deal, provided you are tuned to travel that extra mile.
For example, in Malad West at Marve there are several high-end apartments constructed with a Spanish theme and are very exclusive, a 2 bedroom apartment there comes around 25000 rent and a 3 bhk rent is around 35000 to 40000 even in today’s market conditions. These locations are off beat and may suit professionals, consultants or couples who either travel a lot or have need-based or project based travel.
Most of the time, if you have kids going to school or college, the relocation to another micro-location becomes very difficult as it uproots life to an extent and one has to worry about distances and extra time of travel and find alternate means of travel. The relocation rules completely favour the family and reviewing distances between Home and School are very crucial. If the distance to office grows, its fine, but school and home should be in the reasonable travel distance.
- Be open to see other locations and not just look at one
Recently, a client was opting for an apartment in Andheri West as his daughter was going to a college in Juhu. They found the prices very high in Andheri West and they finally settled for an apartment in Ghatkopar in close proximity to the Metro station, and their life was sorted as their daughter would travel comfortably up to Andheri DN Nagar and then take a rickshaw till Juhu. And the wife was very happy as she got all her shopping, malls and other daily needs at walking distance.
As a property renter in relocation, one has to be vigilant of the infrastructure impact and also out of box thinking to see what options one can have for the value of rent provided by the developer and if one can save some money you can pay for comfortable travel with the saving.
- Start your search at least a month before your move.
When housing societies, go in for redevelopment, obviously the majority of the people, who will be looking to get an apartment will be wanting in the same location and don’t be surprised to see your neighbour in the same apartment while you went to visit it. It’s highly advised, that you start earmarking the location where you want to be well in advance.
- Understand the Neighbourhood, Building & Apartment
Once you have shortlisted a building or an apartment, do visit it again at a different time be it in the day or night. Right from understanding the location, shopping areas around, amenities in the building and what does the apartment offer inside is important. Depending on what you are bringing back from your old flat, and what is available in the new flat is you have to match. Make sure you also spend enough time in an apartment to check water pressure, storage spaces, kitchen cabinets, wardrobes, geysers, piped gas and cell phone receptions.
- Let go of the Old Things
Understandably, we do get hooked onto an old piece of furniture or the old bed etc. this is a spring-cleaning time. Take only what you need in the rented flat and take back only things which are required in the new home and match them perfectly to give you that house proud feeling. There are so many websites, which you can sell or buy furniture online.
- Understand the Agreements – Exit Clause
A lot of us, do not see the intricate clauses in the Leave and License agreements. If you are renting for 2 years or 3 years and are sure that the builder will give you the possession in the time frame. Please insist on a 2 to a 3-year lease agreement with a lock-in period from the owner’s side and be happy to give the same from your side considering you will only move back to your apartment unless you have other plans in the interim. This one clause can save you a lot of money and time. Give an escalation, a fair escalation is anywhere between 5 and 10%, depending on the location. Since the owner pays the Society outgoings for the apartment, it’s only fair that you should not worry on escalations.
- Lease Extension Agreement – in Principle.
While you move into your lease apartment, you must speak to the owners and appraise them about the fact that you are moving in for a period of 2 to 3 years and in the event, if there is a delay in the construction of a few months, the owners should be in agreement with you to extend the lease until the time, you don’t get the lease. Hence, it’s imperative to have excellent relations with the owners, give them the escalations, pay rent on time and then the owner should have no reason to say no to you unless he has other reasons for moving or losing another tenant.
- Put All on Record
These days, with emails, etc. you can keep all the things on record so that there is no grey area of what is agreed upon and not. Draw up a term sheet encapsulating all the terms and conditions of the agreement, the term, the lock-in period, the notice period, rent, escalations, etc. This would help tremendously in the long run.
- List of Amenities/Furniture in the House
Prior to getting the possession of the property, do a joint inspection of the flat with the owners, and sign jointly on the List of Amenities, which should be attached to the Leave and License agreement and duly registered.
In the case of anything, which is not working properly, it should be brought to the owner’s notice in writing before hand. Remember, once the possession is given to you, then there is a huge grey area as to was it working or not etc. If there is anything that the landlord did not agree to fix or you agreed to accept from your initial visit inspection such as Taps, windows, missing tiles in the shower, make sure this damage is documented in your lease as pre-existing.
- What’s included in the rent?
In Mumbai, typically, the Rent is for the premises and/or the car parking if charged extra for an extra car etc. Please ensure that the last payment of Water, Electricity, Cable, Internet, Piped Gas is done before hand and you must pay all the bills on time during the term of the agreement. The best way these days is to place all your utility bills on your credit card to ensure they are paid automatically. Please ensure that you leave sufficient money in advance to the owners at the time of termination or expiry of the agreement to cover the utilities.
- Know your Notice Period and Circumstances
It’s important that you read the agreement termination clauses, so you understand the implications of breaking your Agreement early and your obligation of notice when you choose to move out at the end of a lease term. Be sure to read the agreement well before you execute.
- Society Rules and Regulations
Please follow the society rules and regulations while you are in the apartment. Prior to move in most of the societies, will have a meeting with the new tenant, complete your bio-data there with your important telephone numbers etc. Complete your police verification as per the local laws.
- Stamp Duty and Registration
Ensure, that you get your agreement registered and get a few copies notarized as the original remains with the property owners in Mumbai.
- Paper Work
Do hire an experienced real estate consultant, who can help you with all these aspects, most of the issues, you face during your lease is because you have tried to do all by yourself.
Articles by Sandeep Sadh, CEO – Mumbai Property Exchange