Affordable Rents and Improved Connectivity Attract Tenants to Metro Suburbs
Expensive city centres are no longer driving India’s rental housing growth. Instead, tenants are increasingly moving towards suburban and peripheral corridors across major metros, where improving connectivity and relatively affordable housing are triggering a sharp rise in rentals and fresh housing supply.
According to data from Magicbricks for January–March 2026, rentals across India increased 14 percent year-on-year and 2 percent quarter-on-quarter, even as overall demand growth remained largely flat at 0.6 percent during the quarter.
The report highlights that peripheral micro-markets are now growing significantly faster than established urban centres across NCR, Bengaluru, Hyderabad, and Mumbai Metropolitan Region (MMR).
In Gurugram, emerging corridors such as Southern Peripheral Road (SPR), Dwarka Expressway, and New Gurugram saw far stronger activity in rental supply than traditional sectors. Rental supply in peripheral locations rose 17 percent quarter-on-quarter, compared to only 8 percent growth in core city markets, the data showed.
“Over the last two years, rental escalation in core Gurugram has become steep enough to push a large section of tenants towards newer corridors. Connectivity upgrades through Dwarka Expressway and SPR are making these markets more liveable and attractive for both tenants and investors,” Rajat Lilothia, a Gurugram-based broker told Moneycontrol.
He said that the trend reflects that infrastructure projects are rapidly reshaping residential demand patterns in NCR. Newer corridors offer larger homes, improved metro, and expressway connectivity at relatively lower rentals, he said.
A similar pattern is visible in Bengaluru, where peripheral micro-markets are now outpacing core business districts. Supply in suburban areas in Bengaluru rose 16 percent quarter-on-quarter versus 9 percent growth in central locations, while citywide rentals climbed 8.6 percent during the quarter.
Areas such as Sarjapur Road, Thanisandra, and Kanakapura Road are witnessing strong tenant demand, driven by IT professionals looking for comparatively affordable housing close to emerging tech clusters.
Real estate brokers say tenants are increasingly moving toward these corridors due to rising rents in established city centres while peripheral areas remain affordable and offer improved connectivity to office hubs.
“The post-pandemic preference for larger homes and integrated communities is accelerating movement towards suburban Bengaluru. Many tenants today are willing to stay slightly farther from CBDs if they get better quality housing, social infrastructure, and affordable rents,” a real estate broker active in Bengaluru said.
In Hyderabad, peripheral locations led rental supply growth at 11 percent quarter-on-quarter, with Medchal Highway and Miyapur emerging as key growth centres.
Property consultants say peripheral corridors, once considered spill over markets, are now evolving into independent residential hubs supported by metro rail expansion, expressways, office development, and social infrastructure.
In Mumbai, Taloja recorded 28 percent growth in rental activity, followed by Kharghar at 17 percent and Mira-Bhayandar at 14 percent, reflecting rising demand for budget-friendly and better-connected rental housing options.
Akash Ubale, a real estate broker in Mumbai, said that rental values in Mumbai’s prime business and residential districts have risen sharply over the last few years, making it unaffordable for tenants and prompting them to look at suburban locations that offer significantly better value.
“A tenant can often secure a larger apartment in Mira-Bhayandar or Taloja at 30-40 percent lower rentals than comparable homes in central Mumbai or established western suburbs. Improved metro connectivity and urban infrastructure have eased commute between suburbs and key employment hubs,” he said.
