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Pakistan’s rental laws

Last Updated on June 10, 2024 by admin

Renting is when the property owner allows tenants to use the property in exchange for a monthly payment. The money that the tenants pay is called the rent. It seems very simple. However, there are many complications for both the tenants and the owner. Rental laws are usually pervasive. In this piece, we will try to provide you with a brief overview of the rental laws in Pakistan to deepen your understanding. Do you want to know about the payment plan of Taj Residencia?

The agreement or contract

A legally binding rental contract is a requirement in all cities of Pakistan. The time period for a rental agreement in Pakistan is usually a year. After a year, the deal will stand to be invalid and will have to be renewed. The agreement includes the names of the owner and the tenants, the rental amount, and the mode of payment. If the parties have any additional conditions and rules, those should be added to the contract.

Responsibility for the rental contract

According to the rental laws in Pakistan, the responsibility of drafting a rental contract and getting it registered belongs to the landlord or the property owner. If the owner fails to register the warranty legally, they will have to pay a fine, usually 10% of the rent they receive. On the other hand, the tenants will have to pay a fine of 5% of the rental amount.

Payment of the rent

The laws of Pakistan allow the parties to decide their payment dates. However, the expected payment date of Pakistan is the 10th of every month. Furthermore, the government of Punjab does not intervene in rent or on the yearly rent increase percentage. These decisions are made autonomously by both parties. However, the laws make adding the annual increase in the contract compulsory. Whereas in Sindh, you cannot increase the rent by more than 10%. 

When is the landlord allowed to evict the tenant? 

Your tenants may be driving you crazy, but you are not allowed to evict them except for certain circumstances. According to the rental laws, an owner can evict a tenant when they fail to make the payment on the decided date mentioned in the contract. Similarly, if the tenant causes damage to the property or uses to space to carry out illegal activities, then the landowner has the power to terminate the contract. However, even in these cases, the tenants can still take the matter to court and legally challenge the owner if they feel that the eviction is unfair.

Who will pay the property taxes?

A property tax is a tax charged on the property owned by a person. The owner can pay the property tax even if they have given the property for rent. Currently, in Pakistan, the tax is 15% of the total annual rental income that the property generates. In the case where the tenants pay the property tax, they are charged with a lower rental amount.

Who is responsible for the upkeep of the property?

The laws regarding rental property maintenance in Pakistan are not straightforward and are divided into parts. The responsibility of maintaining the property does not entirely belong to the owner. If the property is damaged due to a natural disaster or its faults, it will have to cover the costs. However, the daily maintenance costs will have to be covered by the tenants. Usually, the landlord charges a maintenance fee in buildings and takes care of all the maintenance.

Can the tenant let someone else live in that property?

Only the people mentioned in the contract can live on that property. The tenant doesn’t have the right to rent out that property to another tenant. If they do this, they can be legally punished, and their contract will be terminated. If the tenant wants to hand over the property to someone else, this should be brought to the landlord’s attention, and matters should be handled legally. Kingdom Valley Islamabad is the only housing society offer you plots at lower prices. 


Rental laws can be confusing to understand and even harder to implement and follow. Hiring a real estate agent, a professional with relevant knowledge, makes this process more accessible and faster. A real estate agent will connect you with other parties and assist you in all matters.

Read More: Property Investment Areas in Pakistan

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