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While the preferred period to rent a property in Mumbai, be it commercial or residential, is a minimum one year, there are instances when properties are leased for a shorter duration for two to six months.
According to real estate brokers, there is no legal provision that prohibits property owners from renting out private property for a shorter period, but the rent charged is at a premium (extra) and is generally 20% higher than the market rate.
All about property leasing in Mumbai
Property owners in Mumbai sign a leave and license agreement with the tenants. A stamp duty is to be paid at the time of registering the leave and license agreement. The stamp duty amount depends on the monthly rental and deposit charged by the property owner.
On an average, as many as 30,000 leave and license agreements are signed and registered with the registry office of Maharashtra government every month.
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According to brokers, property owners who rent their apartment for a shorter period generally charge higher rentals as options in this segment are few and far between.
“A property that can fetch a monthly rent of โน500 per sq ft if leased for five years can get โน600 or โน700 per month if it is leased for six months. This is because the supply of properties that can be leased for a shorter duration is less than properties available in the market for a longer duration,” said Dhiren Doshi, a Mumbai-based property consultant.
“The property owner deserves to charge a premium because the apartment is being leased for a shorter span of time. However, in cases where the property owner is scouting for a shorter-term lease, the premium may go down slightly,โ he said.
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Hereโs a look at properties taken on short-term lease in Mumbai
Recently, Agni Commex LLP had given a commercial space of almost 5830 sq ft on rent to IMC India Securities Pvt Ltd for โน700 per sq ft per month in BKC in Mumbai, documents accessed by Propstack showed.
The commercial space located in Maker Maxity 4, an office space in BKC, has been leased to IMC India Securities Pvt Ltd for โน40.81 lakh per month that works out to be โน700 per sq ft.
Also Read: Highest rental deal in BKC? IMC India leases commercial office space in Mumbai for โน700 per sq ft
However, real estate brokers said that considering the rental period is only six months, the per sq ft rent charged is โน700 per sq ft which is higher than the usual โน500 to 550 per sq ft charged for properties in BKC.
