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Bengaluru flats on rent without deposit — NoBroker data shows a rise
KV Prasad Jun 13, 2022, 06:35 AM IST (Published)
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Summary
This development comes against the backdrop of a surge in rental deposits, which have escalated by 20% in select areas this quarter alone.
In a departure from the conventional practice of requiring rental deposits, zero deposit rental properties are gaining traction in Bengaluru, according to NoBroker, a proptech unicorn in India. This development comes against the backdrop of a surge in rental deposits, which have escalated by 20% in select areas this quarter alone.
Bengaluru, often associated with high deposit-to-rent ratios, has been witnessing a growing affordability challenge in the rental sector. Premium properties, in particular, have been demanding deposits as steep as ₹30 lakh for a 4BHK.
This has been posing difficulties for prospective tenants, especially those relocating to the city for career opportunities. In response to this growing need for more accessible housing solutions, zero deposit rental properties have emerged as a viable alternative, NoBroker said.
The rental bonds serve as a guarantee for landlords, providing financial protection in the event of tenant default.
Under the zero deposit model, tenants pay an upfront yearly premium, typically around 6% of the probable deposit value, along with a potential premium of up to 10% on rent for access to such properties.
This model offers benefits such as faster rental turnovers and credit-verified tenants.
Amit Kumar Agarwal, CEO and Co-founder of NoBroker.com said, “The rental sector has been experiencing an inflation that is quite unusual and Bengaluru tenants, already struggling with rental inflation are now having to deal with exorbitant deposits. Landlords in Bengaluru ask anywhere between 4-10 months of rent as a deposit. Zero deposits as a solution takes care of the needs of landlords as well as tenants and we have seen a lot of them on board with the idea. ”
The survey conducted by NoBroker revealed that 35% of tenants in Bangalore are willing to opt for zero deposit rentals. Currently, 5% of rental properties are being leased out through this bond.
Seamless claims processing and landlords’ willingness to forgo upfront lump-sum deposits are expected to play key roles in driving the adoption of zero deposit rental properties in Bengaluru.
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