Rise of Zero Deposit Rentals in Bengaluru

Bengaluru, May 13, 2024: An emerging new trend is reshaping the real estate rental market in the city of Bengaluru. The city is witnessing the “Zero Deposit Properties” trend. This innovative approach streamlines the renting experience and democratises access to quality housing for a wider demographic.

According to the latest report by NoBroker, despite soaring rental prices—20 % this quarter alone—zero-deposit rentals are becoming the talk of the town. Under this model, tenants pay an upfront yearly premium, typically around 6% of the probable deposit or bond value, equivalent to the minimum return on investment. Additionally, tenants are willing to pay a premium of up to 10% on rent for access to zero-deposit properties. Hence, the benefits of zero-deposit properties extend beyond financial savings. By eliminating the upfront deposit requirement, tenants are granted greater liquidity, enabling them to allocate their funds towards other essential expenses or savings goals.

With the emergence of this trend, Ashwinder R. Singh, Co-Chairman, CII, NR Committee for Real Estate, CEO Residential at Bhartiya Urban, expressed his thoughts, “The emerging trend of zero deposit properties is transforming Bengaluru’s real estate rental market and becomes a win-win for both tenants and landlords. While tenants enjoy reduced financial strain and increased flexibility, landlords benefit from higher tenant retention rates and a competitive edge in the market.”

By eliminating the need for hefty deposits, the zero-deposit model makes renting more inclusive and accessible to a wider demographic, ultimately fostering a more vibrant and dynamic rental market in Bengaluru. This trending financial flexibility empowers tenants to make better housing choices, ultimately enhancing their overall quality of life. This will also result into limited paper work”, said Ankit Kansal, MD, 360 Realtors.

Amidst the pressing needs for accessible housing options, the zero-deposit model emerges as a relief for tenants. This innovative trend works in favor of landlords, providing them with financial security in case of tenant default, covering unpaid rent, utility bills, breach of lock-in periods, and property damages.