Key Money for a House

Question

(1) Is it permissible to take key money for a house or not? Given that in a city like Bombay finding a house is next to impossible (literally, “like bringing a stream of milk”). (2) When the tenant changes, house owners demand a payment for transferring the rent bill from the name of one tenant to the name of the other tenant, and at the same time they raise the rent by a certain proportion. Is this permissible or not?

Answer

(1) If the owner of the house, when renting it out, says: “I shall take such-and-such a sum as a lump sum in advance, and then such-and-such monthly, and then such-and-such yearly,” there is latitude for this. But if the tenant takes key money for vacating the house, or for handing it over on his own behalf to another tenant, this is not allowed. (2)

Source: Fatawa Mahmudiyya

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