Practical guide to real estate in India — from housing and office rental procedures to contracts, deposits, and taxes

If you first envision the entire process of looking for a house in India, it will become clear what you need to look for and negotiate at each step. In particular, housing and apartment complexes where many Koreans live have already been verified in terms of hygiene, security, community operation, and living convenience facilities, making them a good reference indicator when selecting a region.

1. Specify your desired area of ​​residence— Comprehensive consideration of commuting distance, educational environment, Korean community, etc.
2. Review of property through broker and on-site visit— Check living environment, complex operation status, living infrastructure, and contract conditions
3. After discussing conditions, prepare LOI (provisional contract)— In some cases, a lease agreement is entered into immediately.
4. Security Deposit remittance— Landlord verification process required before remittance
5. Ready to move in— Painting, cleaning, and minor repairs usually take about a week.
6. Hand Over after paying Advance Rent— Home inspection and key handover
7. Management office move-in registration— Registration of family, pets, vehicle, housekeeper, driver, application for Club Membership
8. Notification of check-out → Mutual inspection → Return of deposit

Documents that must be checked before sending the deposit

• Ownership verification documents (Sale Deed, etc.)
• Landlord ID Proof
• Recent Utility Bill (electricity/water bill - to verify address)
• Power of Attorney when signing an agency contract

In practice, there are cases where contracts are carried out without confirmation of rental authority. To reduce future disputes and remittance risks, you must confirm through documentation that the actual owner and the contracting party are the same before sending the money.

On the day of handover, check the condition of the house.Meticulously recorded with photos and videosPlease keep it. When moving out, it serves as conclusive evidence to distinguish between existing defects and new damage. Since houses in India often have minor breakdowns such as air conditioners, water heaters, faucets, and door locks even after moving in, it is recommended to include a clause in the contract that states, “Minor repairs that occur within 10 days of moving in will be borne by the landlord.” Depending on the negotiation, it may be adjusted to 15 days or up to 1 month.

As your check-out approaches, you will receive an email, etc. according to the Notice Period (usually 1-2 months) stipulated in the contract.How records are keptYou must convey your intention. Failure to meet the deadline may lead to a dispute where the landlord may claim vacancy damages and deduct a portion of the deposit. A mutual inspection will be conducted with the landlord a day or two before the contract expires, and if there are no problems, the deposit will be returned according to the schedule specified in the contract. The key is to clearly state the return time in the contract at the contract conclusion stage. For your information, after moving in, Police Verification (Tenant Police Registration) process is also conducted for the purpose of verifying the tenant's identity and preventing crime.

Indian home rental contracts have different procedures and legal effects depending on the length of the contract. If the contract period is more than 11 months, Lease Registration is performed. The lessor and lessee visit the Sub-Registrar together to complete signature and photo registration and pay stamp duty and registration fee. On the other hand, the 11-month contract is the most common form of contract in India as it does not require registration.

How registration costs are covered depends on the terms of your contract. In some cases, the burden is shared between the lessor and the lessee, and there are cases where the lessee is asked to pay the full amount.In the early stages of the contract, clearly discuss whether to proceed with registration and who will bear the cost.You have to do it. Some companies subsidize the cost of registering a lease as part of their company policy, so check the company policy as well.

What is the lock-in period?

Lock-in is a mandatory retention period that prevents both the tenant and the landlord from terminating the contract for a certain period of time after the contract is concluded. If you cancel within this period, you may be subject to a penalty or remaining rent specified in the contract.

• Delhi— There is a large variation in the condition of each house, and the living environment can rapidly deteriorate due to termites, water leaks, and issues with plumbing and electrical equipment, so many lock-ins last for a relatively short period of 6 to 11 months.
• Gurgaon— Major apartment complexes have stable management systems and recent rent increases have been rapid, so long-term contracts are sometimes preferred to reduce the burden of increase. If it is a verified complex, lock-in may be set for up to 2 years.

Lock-in is a device that increases residential stability, but at the same time it limits flexibility. After carefully reviewing the contract terms and living environment, set it up to suit your situation.

BHK is a symbol that is always encountered in listing information in India. B stands for Bedroom, H stands for Hall, and K stands for Kitchen.

5 characteristics of Indian houses that are different from those of Korea

• Attached bathroom in each room— It is common to have as many bathrooms as there are bedrooms.
• open balcony— Open structure considering ventilation and heat discharge in high-temperature climates, allowing rain and dust to enter during the rainy season
• Power Backup (DG) Basic— Diesel generator backup is common in apartments, but check separately for independent houses to see if it is installed.
• Separate water storage and supply system— Independent houses have an underground water tank → water supply motor → rooftop water tank. Before moving in, check the water tank cleaning history and the automatic/manual method of the water supply motor.
• Gated communities and security— Outsider access after security personnel, access control, CCTV, and management app approval

Service Apartment

This is a package-type housing product where the operator first signs a Master Lease with the landlord and then provides it back to the tenant. It is equipped with furniture and appliances and often includes housekeeping and facility maintenance, making it highly useful for expatriates, short-term residents, and those in the initial settlement stage. Another advantage is that short-term contracts are often possible and the management window is unified.

However, the designation “serviced apartment” does not guarantee quality. The condition of the furniture, level of cleanliness, and maintenance response speed vary greatly between operators, and the rent is often higher than that of regular apartments. In particular, if the operator's Master Lease is terminated or not renewed, the tenant may need to negotiate a change or transfer of the contract.What to do in case of mid-term termination, whether alternative options are provided, and conditions for returning the depositPlease check before signing the contract.

Lighting, ventilation, noise, and management conditions are difficult to determine through photos or online information. Indian houses have different structures, facilities, and operation methods than those in Korea, so it can be difficult to know what to look for when you first visit, so please refer to the checklist below and check it out on site.

1. Entrance door lock— The key method is common. Request the landlord to install a digital door lock, or check in advance whether the tenant can install it themselves.
2. window frame material— Wooden window frames can attract a lot of fine dust and cause termite problems. Check whether the chassis is PVC or aluminum.
3. curtain installation structure— The rod type can be purchased cheaply from Amazon, etc., but the rail type requires custom manufacturing, which increases costs. If the contract does not include curtains, ask the landlord to install the rod.
4. kitchen gas— Check whether city gas (PNG) is connected. If not connected, use LPG gas cylinder. If supply is available, PNG connection can be requested.
5. RO water purifier— Check installation/operation and recent filter replacement history. The replacement cycle is usually about 6 months, and the cost is often borne by the tenant.
6. air conditioning— Check whether the kitchen is installed as well as the living room and bedroom. AC Annual Maintenance Contract (AMC) included upon request. It may be difficult to repair or secure parts for discontinued models that are more than 7 years old.
7. heating function— Northern India has cold winters, so check whether the air conditioner is in heating mode (inverter). If not, replace with oil heater
8. shower— Some houses only have fixed ceiling showers, so check whether a hand shower can be installed and whether installation can be negotiated.
9. signs of water leaks— Be sure to check for stains, mold, and loose paint on walls and ceilings as these may be structural problems.
10. Water pressure/hot water— Check the water pressure of the shower and sink and the operation of the water heater (Geyser), and also check the condition of the hinges and opening and closing of the cabinet.

LOI (Letter of Intent) — A document summarizing the conditions prior to the main contract

The LOI is a document that organizes and agrees on key terms at a glance before the main contract, such as rent, deposit (interest-free return condition), contract period, lock-in, notice period, rent increase conditions (escalation), whether management fees are included, who will bear the registration cost, and furniture and equipment details. In most cases, it does not have the same level of legal effect as a lease agreement, but it serves as reference material to reduce differences in interpretation between landlords and tenants.

Here are five representative conditions that tenants can request at the LOI stage:

• Professional deep cleaning of the entire house before moving in
• Replace RO water purifier filter before moving in
• Clean and inspect all installed air conditioners
• Complete quarantine and pest control before moving in
• Delivery of all working conditions including electricity, plumbing, and home appliances

We have compiled a list of items that are particularly common in practice when reviewing Indian residential rental agreements.

1. Confirm reflection of rent and contract conditions— Check whether the rent, contract period, and increase rate negotiated in the LOI are accurately reflected in the main contract.
2. GST·TDS provisions— Company Lease is generally subject to 18% GST, Personal Lease is mostly exempt. Clearly state TDS deduction method and responsible party
3. Repair clause— Structural defects (Major Repair) are generally borne by the lessor, and minor repairs such as light bulbs and switches are generally borne by the lessee. It is advantageous to prevent disputes if specific criteria are stated, such as “How much INR repair costs should be borne by the landlord?”
4. Defect clause upon initial move-in— Specify who will bear the burden of repairing defects in existing facilities discovered within a certain period of time (1 week/10 days/1 month) after moving in.
5. Sale clause— In India, housing sales are active even during the rental period, so a clause was added to ensure that the new landlord takes over the terms of the existing contract when sold.
6. Notice provisions and lessor information— Make sure the landlord’s name, address, contact information, and email are included. If you are a landlord living overseas, it is important to have information that allows you to contact them directly.
7. Deposit return clause— When moving out, a joint inspection is performed, and the return period is specifically stated as “within 7 days” or “within 15 days.” Since there are cases of excessive deductions when inspecting by the landlord alone, the joint verification process is specified in the contract.

GST·TDS structure by landlord/tenant type

The tax structure varies depending on whether the landlord and tenant are individuals or corporations.

After paying TDS, individual tenants report it on Form 26QC and send Form 16 Tax Deduction Certificate (TDS Certificate) to the landlord. Serviced apartments vary depending on the contract structure. If rental and services are provided as one package (hotel type), 18% GST is added to the total price;If an invoice is issued separately for pure rent and service costs, 18% GST is charged only on the service amount.This can lower your overall spending. The service ratio is not a fixed standard, but can vary from 10% to 20-25% depending on the operator and contract terms, so it must be judged based on the actual contract structure. (This tax content is reference information reconstructed based on a guide supervised by KPMG tax experts, and expert consultation is recommended for individual cases.)

There are three office types that companies doing business in India most often compare.

• Conventional Office— A method of building interior design, furniture, and networks by directly renting space. Independence and custom design are advantages, but it requires a period of time to prepare for occupancy. The space condition is that there is no DG backup or air conditioning.Bare Shell, only basic facilities are provided.Warm Shell, available for immediate occupancyFully Furnished / Plug & Play, where the landlord decorates the interior according to the tenant's needs and reflects the costs in the rent.Landlord Fit-out / Built-to-SuitIt is divided into:
• Shared Office (Flexible Workspace, FWS)— Use the space built by the operator as a service. Desks, conference rooms, internet, and cleaning are included, and staff and period adjustments are flexible, making it suitable for early-stage companies (WeWork, Cowrks, Awfi, Regus, etc.)
• Managed Office— The operator provides interior design, furniture, and facility operation for the company’s exclusive space. Secure both independence and convenience (Smartworks, TEC, Simpliwork, Skootr, etc.)

Some Grade A buildings in Gurgaon require leasing of the entire floor or a certain size or more without small installments, so small businesses consider FWS or Managed Office as an alternative.

8 Steps to Processing a Commercial Real Estate Contract

1. Market analysis and status diagnosis
2. Candidate office selection and first visit
3. RFP/RFI Request for Proposal and Selection of Finalists
4. Condition negotiation and financial analysis — Total occupancy cost analysis, including Rent Free, CAM, security deposit, escalation, parking, and fit-out contribution.
5. Legal, technical, operational due diligence and internal approval
6. Conclusion of contract and securing possession rights
7. Interior and move-in preparation
8. Commencement of operation

The entire project is usually3~6 monthsIt takes time, including market research, based on the target move-in date.6 months to 1 year agoMany companies start their review from the beginning. The more time you allow for negotiation, the more likely you are to obtain favorable terms for rent, Rent Free, and interior design assistance.

Gurgaon Grade A Office Standard Terms and Conditions (Reference Example)

In India, there are significant differences in contract terms, deposit, CAM, reinstatement conditions, etc. depending on the state, city, and building, so the table above should be used as a reference and you must check the conditions of each individual asset.

The most frequently disputed points in office contracts are the relationship between lock-in and notice, and the rental start date.

Is the notice period included in the lock-in?

For example, if you signed a contract with a lock-in of 3 years and a notice of 3 to 6 months, the notice is included in the lock-in.If not includedAfter the lock-in ends, an additional 3 to 6 months must be used, effectively resulting in a 36-month + additional period structure. on the other wayWhen includedYou can use the last 3 to 6 months as a notice period to move out at the end of the lock-in. Be sure to check whether the contract clearly states “Notice period is included in Lock-in period” or “excluded from”.

LCD vs RCD — Two Start Dates

• LCD(Lease Commencement Date)— The legal and contractual lease start date from which the right to use the space arises. From this point on, interior construction is possible, and CAM costs are incurred even if there is no rent (sometimes the full amount or only 50% is charged).
• Rent Commencement Date (RCD)— The date on which actual rent payment begins, usually at the time of move-in after completion of interior design (fit-out). If the interior is finished early, you can use the space rent-free until RCD.

The lock-in start date for LCD or RCD may vary depending on the contract, so prior confirmation is required. Additionally, if it is not Grade A or requires verification of building history, we recommend verification of permit documents such as OC (Occupancy Certificate) and Fire NOC and on-site due diligence.

Check operating conditions

• Sufficient power capacity, DG backup cost, facility management level, access control/parking operation method
• HVAC operating hours— Some buildings are only open from 8 AM to 8 PM or have limited weekend operation, and minimum billing or full operating costs may apply for out-of-hours use.
• Is there a public restroom on each floor? If not, consider adding additional internal installation space and construction costs.

Based on building zoning and area

Lastly, it is based on area.Carpet Areais the actual usable area based on the inside of the wall,Built-up Areais the area plus the wall thickness and pillars,Super Built-up Area (SBA)The area includes common spaces such as hallways, lobbies, and elevators. In India mostRent calculated based on SBATherefore, the effective rent must be calculated taking into account the difference between the contracted area and the actual exclusive area. Just remember that rent is paid through SBA, and the actual space used is judged by the carpet area.