Renting Out a House in Islamabad and Rawalpindi: The Landlord’s Guide to Rent, Tenants and Agreements

A house that earns rent every month is one of the most dependable investments in the Twin Cities — when it is let to the right tenant on the right terms. When it is not, it can mean months of unpaid rent, damage, and a difficult eviction. Most of that risk is removed by a few habits at the start of every tenancy.

Setting the rent

Rent follows three things: location (commute, schools, markets), condition (how recently the house was built or refurbished) and what else is available nearby. Look at houses of the same size in the same society or sector, and adjust for:

• Separate upper and lower portions — often let separately, which can raise total rent.
• Parking, a lawn, gas availability and backup power or solar.
• Furnishing, if any.

Pricing slightly below comparable houses usually lets faster, and an empty month costs more than a small discount.

What the house really earns

Net yield = (rent × months actually let − yearly costs) ÷ house value.

Costs include repairs and repainting between tenants, society maintenance charges, property tax and any agent’s fee. Use the Rental Yield calculator to compare the net return with other uses of the money, and our plot versus house investment guide for the bigger picture.

Screening tenants

• Identity — copy of the CNIC (or passport and visa for foreign nationals), and verify it.
• Employment or business — employer letter, or business details.
• References — the previous landlord, if possible.
• Family size and use — residential use only unless you agree otherwise.

Meet the tenant yourself, even if an agent found them.

Register the tenant with the police

In Islamabad and in Punjab, landlords are required to register tenants with the local police, usually through a tenant registration form with copies of the tenant’s and owner’s identity documents — many areas now allow this online or at a police facilitation centre. Registration protects you and is often requested by the society as well. Do it before handing over the keys.

The tenancy agreement

Write it on stamp paper of the appropriate value and have it signed and witnessed. Include:

1. Parties — names, CNICs, addresses.
2. Property — address, portion (upper, lower or whole) and fixtures included.
3. Rent — amount, due date, and payment method (bank transfer).
4. Security deposit — amount, and when and how it is returned, with deductions only for unpaid dues and damage beyond normal wear.
5. Advance rent, if any.
6. Term — commonly eleven months or one year.
7. Yearly increase — a fixed percentage on renewal, agreed now.
8. Utilities — who pays electricity, gas, water and society charges, and that bills must be cleared before leaving.
9. Maintenance — who pays for minor repairs, and that major repairs are the landlord’s.
10. Use — residential only; no subletting without written permission.
11. Notice period — for either side to end the tenancy.
12. Inspection — the landlord’s right to inspect with notice.
13. Handover condition — attach dated photos of the house at move-in.

Money through the bank

Take the deposit and rent by bank transfer, and give a receipt for any other payment. It creates a record for both sides and for tax.

Keeping a good tenant

Repair things promptly, keep increases to what was agreed, and give notice before inspections. A tenant who stays for years is worth more than a slightly higher rent from someone new.

Building to rent

If you are building a house to let, designing the upper and lower floors as self-contained portions — each with its own entrance, kitchen and meters where possible — usually earns more than letting it as one house. Our 5 marla versus 10 marla guide and construction cost guide help you plan it, and our Faisal Hills construction rates are published by block.