Mumbai real estate market: Can you rent a property in the financial capital for two to six months?

You can rent a property in Mumbai for two to six months but the landlord may charge a premium considering that the lease is for a short duration, said brokers.

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.

Mumbai real estate: There is no legal provision that prohibits an owner from renting his property in the city for a shorter period, said local brokers. (Mehul R Thakkar)

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.

A shorter rental agreement attracts premium charges

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 ₹500 per sq ft if leased for five years can get ₹600 or ₹700 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,” he said.

Here’s 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 ₹700 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 ₹40.81 lakh per month that works out to be ₹700 per sq ft.

However, real estate brokers said that considering the rental period is only six months, the per sq ft rent charged is ₹700 per sq ft which is higher than the usual ₹500 to 550 per sq ft charged for properties in BKC.