RENT CONTROL ACT

Urban design
Ar-902

BY:
SHOBHIT VERDHAN
BARN1AR14064
What is Rent Control ?
Renting an apartment can be a cost-effective way for a
young or middle-income person to live in or near a major
city and enjoy a lifestyle that homeownership could
never offer. However, rental rates have a tendency to rise
over time as landlords find tenants willing to pay more or
as the cost of housing rises due to inflation.

The Rent Control Act was an Act of Parliament,

intended to control excessive rents being charged by
landlords.

Definition

Rent control is a program that some cities institute to set limits on how much landlords may raise rent on existing
tenants. It is most common in cities with large populations where tenants may have difficulty finding affordable
housing. Most rent-control programs include exemptions and exceptions, so rent control doesn't apply to all rental
units in the city. However, for those tenants with rent-control apartments, the financial protection can be essential
for remaining in an apartment for a long period of time.
Purpose
The purpose of rent control is to ensure that a city has a certain
amount of affordable housing for lower- and middle-class
residents. Without rent control, rental rates would rise and fall
based on supply and demand. Cities that are desirable places to
live could easily become overpriced for all but the wealthiest
residents, causing problems with the labor market and creating
large economic inequality.

Policies
Every city sets its own specific policies for rent control. Most
policies allow landlords to raise rent by a certain percentage
each year. This may be a flat rate, as it is in New York City, or it
may be tied to inflation, as is the case in cities like San
Francisco. Landlords may petition for larger increases because
of unusual economic circumstances, but for the most part
tenants can expect to pay only slightly more in rent each year.
How did it originate ?

Rent controls were introduced in the early 1900s in the United States and
some other parts of the world to check uninhibited rent increases and
tenant eviction during wartime housing emergencies. After World War II,
there was a sudden increase in the demand for rentable housing from
soldiers returning home. With industrialization and corresponding
urbanization, there was an increase in rural-urban migrations. To prevent
rents from rising too much owing to this spurt in demand, Rent Control
Acts (RCAs), under various names were introduced in many countries.
These were called the first-generation rent controls. Those introduced
later were called the second-generation rent controls or soft rent controls,
because they provided for some leeway in rent increases and tenant
landlord relationship.

The first rent control legislation in India was introduced immediately after the First World War in Bombay in 1918. It was
followed by similar legislations for Calcutta and Rangoon in 1920. By the end of the Second World War almost all the major
cities and towns in the countries were covered by rent control measures. All these acts, born out of the inflationary aftermath
of the First World War, were conceived as purely temporary measures to provide relief to the tenants against the demand of
exorbitant rent and indiscriminate eviction by the landlords due to scarcity of houses in the urban areas. As in other parts of
the globe, the rent control laws applicable in various states in India are different with respect to various aspects and thus, a
holistic analysis, though attempted here, is difficult.
The Legal Aspects of Rent Control

Under the Indian Constitution, housing (provision of) is a state subject. Thus, the enactment and enforcement of
rent control laws is the responsibility of the individual states. While this is in accordance with the federal nature of
the Indian Republic, it makes a comparative analysis of the rent control laws that much more difficult. The common
thread running through almost all rent control Acts and legislations is that they are intended to serve two
purposes:

1. To protect the tenant from eviction from the house where he is living except for defined reasons and on
defined conditions; and
2. To protect him from having to pay more than a fair/standard rent.

But most acts also confer upon the landlord the right to evict a tenant who is guilty of certain specified acts and
also when the landlord requires the house for his own personal occupation. There are various grounds under
which a landlord can evict a tenant. The most common of these are listed below. There are also some states,
where one or more of the provisions given below don’t apply.

1. Breach of condition of tenancy

2. Subletting
3. Default in payment of rent for specified period 4.
4. Requirement of building for own occupation 5.
5. Material deterioration in the condition of the building
Advantages
• The primary advantage of rent control occurs for tenants. Besides
paying an affordable rent, they can predict what rent will cost in the
future and budget accordingly without the fear of large or sudden
increases that may make living in an apartment unaffordable.
• Rent control also has advantages for cities, allowing neighborhoods
to retain economic and social diversity and allowing middle-class
workers to live within the city rather than being pushed to low-cost
suburbs or urban slums.

Drawbacks
• Rent control also has some significant disadvantages. It creates
artificial scarcity by encouraging tenants with rent control to remain
in their apartments longer. This can reduce the number of available
apartments at any given time and drive up the price of available units.
• In addition, rent control creates an incentive for illegal rental
practices, such as unauthorized subleases that tenants use to make a
profit by renting their apartments to new tenants for more than they
already pay the landlord under rent control.
Rights of Landlord Under the
Act

Evicting a Tenant – Under the Rent Control Act, the landlord

has the right to evict the tenant. The states have individual
byelaws. In Punjab and Haryana, a landlord can evict the tenant
on the basis of a personal, bonafide requirement, whereas the
same does not happen in the Karnataka byelaws. But playing by
ordinary rationale, courts allow for the eviction of the tenants on
the landlord’s request, keeping into consideration facts and
circumstances. The Draft Model Tenancy Act, 2015 shall make
matters easier for the landlords.

Temporary Recovery of Possession – In order to make all the necessary repairs, alterations and changes in the
property, a landlord has a right to recover temporary possession of the same.

Rent Changes – The Draft Model Tenancy Act is an instrumental legislation. Rent changes are something that usually
occurs in accordance with the whims and fancies of the landlord. The rent cannot be unreasonably high or increased
suddenly, however, the upper hand remains of the landlord and he can periodically increase the rent of the property.
Rights of Tenant Under the Act

Fair Rent – A landlord cannot unjustifiably increase the rent,

however, he can approach the Rent Control Court in order to
fix a rent. The rent has to be fair which is usually supposed to
be 9% of the value of the building in totality including the cost
of construction, the market value of land and amenities being
provided.

The landlord also does not possess the right to disconnect

essential services of electricity and water even due to rental
reasons. They can approach the court, however, cannot deprive
you of your basic supplies and amenities.

Eviction – In order to evict a tenant the landlord is required to approach the court and cannot unjustifiably evict the
tenant. Byelaws play a major role in such a scenario. The Maharashtra byelaws are such that do not allow for the
eviction of the tenant if the tenant is willing to acquiesce and agree to the changes in rent and is willing to pay the
same. A notice is also to be given ninety days prior to filing a suit.
Salient features of the Rent Control Act

The Rent Control Act provides tenants with security and restricts landlords in their ability to evict their tenants.
It eliminates loopholes, which laid both, landlords and consumers, open to the possibility of deceit.

The main features of the Rent Control Act are:

• It imposes various laws on the renting out of properties, to help

potential tenants in identifying and securing good rental
accommodation.
• It imposes fair, standardised rental ranges, beyond which tenants
cannot be charged under most circumstances.
• It intends to protect tenants against discrimination and against
unfair eviction by their landlords.
• It defines landlords’ responsibilities and obligations towards their
tenants, in terms of the maintenance of the rented-out homes.
• It also clearly defines the rights of landlords, with regards to tenants
who do not fulfil their obligations of paying timely rent, or misuse
the property in any manner.”
The Delhi Rent Control Act: Historical
Background

The first rent control measure in Delhi came after the outbreak of the Second World War in 1939, under the Defense
of India Rules. This was restricted to New Delhi and the Notified Area, Civil Station. In 1942, the provisions of the
Punjab Urban Rent Restriction Act, 1941 were made applicable to the remaining areas of Delhi. It was soon
realized that the provision of the Punjab Act were insufficient for a city like Delhi and thus, it was supplemented by
another Order under the Defense of India Rules in 1944. After the war, another comprehensive legislation was
passed for all parts of Delhi by the name of The Delhi and Ajmer Marwara Rent Control Act, 1947. In 1952, it was
repealed by The Delhi and Ajmer Rent Control Act, which substituted it and ceased the application of rent Acts of
other states to certain parts of Delhi.

Another attempt was made in 1958 to plug certain loopholes of the 1952 act. In the same year, the Slum Areas
(Improvement and Clearance) Act was passed which sought to protect the interest of the slum dwellers. The next
comprehensive enactment on rent control in Delhi was passed in 1958 and came into force on February 9, 1959.
This is the current legislation of rent control in Delhi and it extends to the areas included within the New Delhi
Municipal Committee and the Delhi Cantonment Board, together with the urban areas of the Municipal Corporation
of the Urban Areas in Delhi.
Basic details of Rent Control Act, India
Basic details of Rent Control Act, India
Basic details of Rent Control Act, India
Basic details of Rent Control Act, India
Basic details of Rent Control Act, India
THANK
YOU