Coliving regulations in India

What it does: Caps deposit at 2 months' rent for residential and 6 months' for commercial. Requires written rental agreement for any tenancy 12+ months. Establishes Rent Court / Tribunal for fast dispute resolution. Adopted in Andhra Pradesh, Tamil Nadu, Uttar Pradesh; pending in others.

Trigger: Operating coliving in any MTA-adopting state.

Fix: Use the standard MTA template (states publish them) for tenant agreements above 12 months. For sub-12-month stays, the older state-specific tenancy law applies. Keep deposit at the 2-month cap regardless of state — it's the direction of travel.

What it does: Bruhat Bengaluru Mahanagara Palike (BBMP) requires PG licence for any premises operating as paying-guest accommodation with 5+ unrelated tenants. Licence conditions include fire safety, minimum room sizes, sex-segregation rules in some interpretations.

Trigger: Any coliving operation in Bengaluru housing 5+ unrelated tenants.

Fix: Apply for PG licence per property. Cost is nominal (₹2,000–₹10,000 per property) but processing takes 8–16 weeks. After Hyderabad and Bengaluru fire incidents, BBMP enforcement has tightened.

What it does: Residential dwellings let for residential use are GST-exempt. Hostels, PG accommodation, and serviced residences fall under SAC 9963 (12% GST) or 9971 (18% GST) depending on bundled services. Coliving with shared services typically attracts 12–18%.

Trigger: Operating any coliving with bundled services (housekeeping, food, internet).

Fix: Decide deliberately: pure residential rental = GST-exempt; serviced PG/coliving = 12–18% GST. Stanza Living and most large operators run as GST-registered serviced operations. The decision affects your input-tax-credit position too — bundle costs net favourably under GST registration.

What it does: Requires registration of any real estate project above ₹500 sqm or 8 units with the state RERA authority. Protects buyers/tenants; obliges developers to disclose project plans, timelines, and financial information.

Trigger: Developing or significantly converting buildings above 500 sqm for coliving.

Fix: Register if scale crosses threshold. Most state RERAs now have specific coliving project categories. RERA registration is also a credibility signal for institutional capital.

What it does: Older state rent control laws limit rent increases on legacy buildings. Mumbai's MRC Act applies to pre-1947 buildings (vanishingly few coliving-relevant). Tamil Nadu has specific notice-period rules.

Trigger: Operating in legacy buildings in rent-controlled states.

Fix: Generally not relevant to new coliving inventory (modern conversions, post-2000 buildings). Verify the specific building's status before LOI.