A proper PG rental agreement format is not just a document. It’s operational protection. It defines expectations, reduces misunderstandings, and protects your revenue.

If you’re looking for a PG rental agreement format or a PG agreement sample in India, this guide will walk you through:

What clauses must be included
How to structure lock-in and notice periods properly
Legal mistakes PG owners commonly make
How to manage agreements digitally
And where to download a ready-to-use template

Let’s build this properly.

Why a PG Rental Agreement Is Different from a Regular Lease

Many owners make the mistake of using a standard residential rental agreement for their PG.

But PG accommodation is different.

Unlike traditional leases, PG setups often include:

Shared rooms
Common amenities
Food services
Utility bundling
House rules and behavioral expectations

This makes the agreement more operational in nature, not just legal.

Without clarity in documentation, most disputes happen around:

Early exits
Security deposit deductions
Electricity billing
Lock-in misunderstandings
House rule violations

A structured agreement prevents confusion before it starts.

Essential Clauses Every PG Rental Agreement Must Include

A strong PG agreement sample in India should cover more than just rent and deposit. It should clearly define the relationship between the owner and the occupant.

Here are the essential sections that should always be included:

1. Tenant and Owner Details

Full legal names, permanent addresses, ID proof details, and contact information must be clearly mentioned. This protects both parties legally and ensures documentation is complete.

2. Property Description

Clearly mention the full property address along with the specific room or bed number. In shared accommodations, this prevents confusion over space allocation.

3. Rent and Payment Terms

This section should define:

Monthly rent amount
Exact due date
Accepted payment modes
Late payment penalty (if applicable)

Vague payment terms create operational ambiguity. Clarity creates discipline.

4. Security Deposit Clause

Deposit disputes are one of the most common issues in PG setups. The agreement must specify:

Deposit amount
Conditions for deduction
Refund timeline
Inspection process upon exit

The more detailed this clause, the fewer disputes later.

5. Lock-In Period

The lock-in clause defines the minimum duration the tenant must stay. If they exit early, financial consequences should be clearly defined.

Without a lock-in clause, occupancy planning becomes unstable.

6. Notice Period

This section should specify:

How much notice is required
Whether notice must be written
Rent liability during notice period

Notice clarity protects vacancy planning and revenue continuity.

7. Utility & Additional Charges

If electricity, WiFi, water, or food are charged separately, the billing structure must be defined clearly. If electricity is metered separately, specify the per-unit rate and billing cycle.

Ambiguity here almost guarantees disputes.

8. House Rules & Conduct

This section should cover guest policies, behavior expectations, damage liability, and shared space responsibilities.

House rules are easier to enforce when they are documented and acknowledged at the time of signing.

If you’d like a structured clause-by-clause reference before drafting your agreement, go through our detailed Rent Agreement Checklist to ensure nothing critical is missed.

Lock-In Period vs Notice Period: Understanding the Difference

These two terms are often confused.

A lock-in period is the minimum stay duration.
A notice period is the advance time required before vacating.

For example:

If your agreement includes a 6-month lock-in and a 30-day notice period:

The tenant cannot leave before 6 months without penalty.
After 6 months, they must still give 30 days’ written notice before vacating.

If this distinction is not clearly written, misunderstandings are inevitable.

Common Legal Mistakes PG Owners Make

Even experienced operators make avoidable documentation mistakes.

Some of the most frequent ones include:

Using generic residential lease templates
Failing to mention late payment penalties
Not defining deposit refund conditions clearly
Ignoring lock-in structure
Accepting unsigned agreements
Not updating agreements when policies change

Another common issue is relying on verbal agreements.

Verbal understandings work, until there is disagreement.

And when disagreement arises, only written documentation protects you.

Should PG Agreements Be on Stamp Paper?

In India, rental agreements typically require stamp duty as per state laws.

However, PG arrangements sometimes fall under service agreements rather than pure tenancy agreements, especially when food and amenities are included.

The requirement may vary depending on:

State regulations
Duration of stay
Nature of services provided

While legal consultation is recommended for stamp duty compliance, the most important factor remains this: documentation must exist.

Unsigned or informal arrangements increase risk.

PG Rental Agreement Format, PG Rental Agreement Format (Free Template), Rentok

Traditional agreement handling usually follows a familiar pattern.

An agreement is printed, signed by the tenant, scanned, and stored away in a folder, often untouched until the exit process begins.

At a small scale, this may seem manageable.

But once you’re handling 80 – 100 tenants across multiple properties, the cracks start to show. Monitoring agreement start dates, renewal timelines, notice periods, and lock-in clauses gradually turns into a manual and error-prone process. Important dates get missed. Renewals are delayed. Compliance becomes reactive instead of planned.

This is where a digital agreement workflow changes the structure.

Instead of physical files and scattered records, you get:

Standardized agreement templates
Secure document storage
Automated timeline tracking
Centralized access across properties
Reduced dependency on paperwork

For growing PG operators, this isn’t just convenience, it’s operational stability.

If you’re exploring how digital documentation works in practice, read our Ultimate Guide to Digital Rent Agreement (Free Template) to understand the legal structure, workflow setup, and compliance considerations in detail.