Curated By: Business Desk
Last Updated: September 18, 2023, 12:54 IST
The person who takes property on the lease becomes the owner until the term ends.
A lease is used for properties that are used for a longer period of time. renting a property may or may not be for long-term use.
The Indian real estate sector has continued to show robust growth and trajectory in the last few years. It is becoming more and more difficult for people to rent properties due to a shortage of available places and high rentals. In the context of property, two terms that are often heard are rent and lease. Both are types of rentals and the difference between them depends on the duration.
A lease is used for properties that are used for a longer period of time. Renting a property may or may not be for long-term use, and a rent agreement is usually of a short duration and has to be renewed every 11 months. On the other hand, a lease can be for many years. So, let’s take a deeper look and understand which among them is better when taking a property:
According to the property laws, a lease can be taken for a maximum period of 99 years. Once the total lease period is completed, it can be renewed again. The person who chooses to take a lease on the property is responsible for its maintenance. But sometimes the maintenance clause also depends on the agreement that has been signed by the tenant and the owner. On the other hand, the maintenance of a property that is rented has to be done by the owner. For that, they take maintenance charges from the tenant.
The person who has taken the lease as an option for the property becomes the owner until the term ends. But if the lease is not registered, then it becomes invalid in 12 months.
When a person chooses to rent a property, they do not become the owner. The landlord can amend the rental agreement at any time. Even if the registration is not done, the rental agreement is still considered valid. In the end, leasing gives the option of buying the property by paying the remaining amount.
If a person is ready to pay the rent every month in exchange for the property, they can choose rent as an option. But for commercial properties, it is usually advised to go for leasing. The person does not have to pay the rent every month and concentrate on their work. But they have to pay a lump sum amount in one go while leasing.