Rent without rights: Why Karnataka needs the Model Tenancy Act?

When the Government of India launched PMAY-Urban 2.0, it mandated all states and Union Territories that signed the Memorandum of Agreement to adopt the Model Tenancy Act (MTA), 2021, through new or amended rent control laws by June 2025. That deadline has passed, and Karnataka, like many others, has yet to act. This means that thousands of migrant families, students, and young professionals continue to bear the brunt of an unregulated rental market in Bengaluru and other major cities. 

The most visible sign of this policy vacuum is the steep security deposit norm -- often six to 10 months’ rent upfront -- translating to Rs 1–2 lakh for a modest home, turning housing into an entry barrier to the city. With urban migration and housing demand rising, this unwritten rule has become one of Karnataka’s most persistent affordability challenges. Unlike Mumbai, Delhi, or Hyderabad, where deposits typically range from two to three months’ rent, Bengaluru has allowed this practice to go unchecked. Tamil Nadu recognised this inequity and, in 2017, enacted a law capping deposits at two months and mandating formal tenancy agreements. 

In the absence of a clear, enforceable rental framework, landlords justify higher deposits as protection against rent default or property damage, shifting all financial risk onto tenants. For single-income and migrant households, locking up Rs 1-2 lakh in deposits is often impossible. According to a 2023 Government of India report, urban families spend nearly two-thirds of their income on basic needs such as food, clothing, house rent, health, education and daily commute. With little disposable income, a large deposit becomes a barrier to mobility and security, pushing many away from safe and better-serviced neighbourhoods towards overcrowded or substandard housing.

Affordability, however, is only one part of the problem. Discrimination in renting is an equally pervasive yet under-acknowledged barrier. Across Bengaluru and other cities, tenants are denied housing on grounds of caste, religion, gender, marital status, food habits, or place of origin. While such practices remain invisible, there is no clarity on what constitutes discrimination, no redressal mechanism, and little awareness among tenants of their rights. Tenants who face discrimination move on quietly, knowing that challenging it means lost time and no assurance of justice. This allows such practices to become normalised as “landlord’s choice”.

Outdated laws, unequal burdens

These economic and social barriers stem from the same structural gap: an outdated legal framework that fails to protect either party. Karnataka’s Rent Control Act of 1999/2006 neither caps deposits nor ensures fair rents. Many tenants recount losing part or all of their deposits to arbitrary deductions at the end of tenancy.

A modern framework is long overdue. The MTA caps security deposits at two months for residential agreements, mandates written contracts, and seeks the establishment of rent authorities and rent tribunals to resolve disputes and protect tenants from excessive demands as well as create a transparent rental framework. For tenants, it offers legal clarity, standardised documentation, and formal grievance redressal. For landlords, it ensures timely rent payment, faster recovery of property in case of default, and less reliance on informal arrangements that often lead to disputes. By institutionalising rental relationships, the Act aims to replace negotiation and mistrust with accountability and due process.

While Tamil Nadu was the first state to implement its version of the MTA, implementation took more than three years, revealing the administrative and institutional groundwork such reforms demand. Karnataka must begin this process now. 

The state must tailor the Act to its urban realities through city-specific rental housing needs assessment studies. Bengaluru (BBMP–BDA areas) can form one cluster, Tier-1 cities such as Mysuru, Mangaluru, and Hubballi-Dharwad another, and smaller urban centres a third. Each cluster faces distinct rental housing challenges, and such segmentation will help identify issues faced by both tenants and landlords.

Implementation will depend on building institutional capacity for timely dispute resolution. The MTA proposes quasi-judicial bodies such as rent authority, rent court and rent tribunal to register agreements, mediate conflicts, and ensure compliance. These are essential to reduce the backlog of rent-related cases in civil courts and provide both tenants and landlords with accessible, time-bound redressal. Without such structures in place, rental disputes will continue to be settled informally or left unresolved, undermining the purpose of the legislation.

Karnataka’s urban rental market sits at a critical juncture. The absence of a regulation has allowed informal practices, arbitrary deposits, and discriminatory screening to shape who gets to live where. Implementing the Model Tenancy Act is a necessary first step toward a more equitable rental system, one that balances rights with responsibilities, protects both tenants and landlords, and expands access to secure housing. For a state where rental housing sustains much of the urban workforce, adopting such a framework is a social and economic necessity.

(The writer is a researcher at the Indian Institute for Human Settlements and works on issues of affordable housing and rental housing)