High Rent Prices in Mumbai Causing 'Brain Drain': A Closer Look
Renting a 1 BHK in Mumbai costs ₹5.18 lakh annually, surpassing the average salary of junior employees. High rental prices are pushing professionals to move to more affordable cities, leading to a 'brain drain'.
MumbaiReal EstateBrain DrainRental PricesCredaimchiReal Estate MumbaiOct 18, 2024
The report further reveals that in cities like Bengaluru and Delhi-NCR, the annual rent for a 1 BHK flat is nearly half of that in Mumbai, at ₹2.32 lakh and ₹2.29 lakh, respectively. These cities also offer higher average annual salaries, with Bengaluru at ₹5.27 lakh and Delhi at ₹4.29 lakh.
The real estate developers' body points out that the negative disposable income in Mumbai makes it challenging for residents to cover basic living expenses. Negative disposable income occurs when, after paying for essential expenses like rent, food, and bills, a person either has no money left or even falls short.
For mid-level employees in Mumbai, who earn about ₹15.07 lakh annually, the report shows they spend almost half their salary on rent for a 2 BHK apartment, costing ₹7.5 lakh per year. In comparison, mid-level employees in Bengaluru and Delhi-NCR spend significantly less on rent. In Bengaluru, they earn ₹16.45 lakh and spend ₹3.90 lakh annually on rent, while in Delhi, they earn ₹14.07 lakh and spend ₹3.55 lakh on rent.
Senior-level employees in Mumbai, earning around ₹33.95 lakh annually, spend ₹14.05 lakh on rent for a 3 BHK flat. In contrast, senior professionals in Bengaluru and Delhi-NCR pay much less, spending ₹6.25 lakh and ₹5.78 lakh, respectively, for similar accommodation. Many senior professionals are leaving Mumbai in search of a better lifestyle and more savings.
CREDAI-MCHI, the real estate developers' body, emphasizes the need for policymakers to address the issue of high rental prices to retain talent and maintain the city's economic vibrancy. The 'brain drain' could have long-term implications for Mumbai's status as a major financial and commercial hub.
Frequently Asked Questions
What is the average annual rent for a 1 BHK flat in Mumbai?
The average annual rent for a 1 BHK flat in Mumbai is around ₹5.18 lakh.
How does the cost of renting a 1 BHK flat in Mumbai compare to other major cities in India?
In cities like Bengaluru and Delhi-NCR, the annual rent for a 1 BHK flat is nearly half of Mumbai’s cost, at ₹2.32 lakh and ₹2.29 lakh, respectively.
What is the average annual salary for junior-level employees in Mumbai?
The average annual salary for junior-level employees in Mumbai is ₹4.49 lakh.
What is the impact of high rental prices on mid-level employees in Mumbai?
Mid-level employees in Mumbai, who earn about ₹15.07 lakh annually, spend almost half their salary on rent for a 2 BHK apartment, costing ₹7.5 lakh per year.
How does the cost of living in Mumbai affect senior professionals?
Senior-level employees in Mumbai, earning around ₹33.95 lakh annually, spend ₹14.05 lakh on rent for a 3 BHK flat, leading many to move to more affordable cities.
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