India's Rental Market Surges: Chennai, Delhi, and Thane Lead in Rent Hikes
Delhi and Thane witnessed significant rental increases, with Delhi's average rent climbing 11.4% QoQ to Rs 37.55 psf, and Thane's rent rising 10.9% QoQ to Rs 33.10 psf. Chennai recorded the sharpest increase at 22.2%.
Rental MarketRental PricesIndia Real EstateChennaiDelhiReal Estate MaharashtraNov 18, 2024
Chennai leads the pack with the steepest increase, with rents soaring 22.2% QoQ from Rs 17.94 psf in Q2 2024 to Rs 26.91 psf in Q3 2024. Delhi and Thane also saw notable hikes, with Delhi's average rent climbing 11.4% QoQ to Rs 37.55 psf, and Thane's rent rising 10.9% QoQ to Rs 33.10 psf.
Mumbai remains the priciest rental market at Rs 86.50 psf per month, followed by Delhi at Rs 37.55 psf and Navi Mumbai at Rs 33.83 psf. On the other hand, developing markets like Greater Noida (Rs 15.48 psf), Noida (Rs 21.32 psf), and Kolkata (Rs 22.14 psf) remain more affordable.
Prasun Kumar, Chief Marketing Officer of Magicbricks, commented on the findings 'This year, rental demand has shown a strong quarter-on-quarter surge, driving rents to the sharpest increase we've seen over the past eight quarters. It's evident that ready-to-move apartments are increasingly being purchased for self-use, contributing to a decline in rental supply. Meanwhile, the rise in under-construction supply suggests potential for market balance in the coming quarters as more inventory becomes available.'
The report highlighted a significant 14.8% QoQ increase in rental demand during the previous quarter (April to June 2024), which continued to rise, albeit at a slower pace, by close to 2% in the third quarter (July to September). However, the supply of rental properties declined by 6.7% QoQ during this period, creating an imbalance that has driven rental prices upward.
Gross rental yields across the 13 cities reached 3.62%. Ahmedabad led with the highest yield at 3.9%, followed by Hyderabad, Kolkata, and Pune at 3.7% each. Chennai saw the largest QoQ yield growth at 21.3%, while Delhi, Hyderabad, and Navi Mumbai reported strong increases at 8.8%, 5.4%, and 5.3% respectively. However, cities like Greater Noida, Gurugram, Kolkata, Mumbai, Noida, and Pune experienced declines in yields as property price growth outpaced rental rate growth.
Frequently Asked Questions
Which city saw the highest increase in rental prices QoQ in 2024?
Chennai recorded the highest increase in rental prices QoQ in 2024, with rents soaring 22.2% from Rs 17.94 psf in Q2 to Rs 26.91 psf in Q3.
What is the average rent per square foot per month in Delhi as of Q3 2024?
The average rent per square foot per month in Delhi as of Q3 2024 is Rs 37.55 psf.
Which city has the highest rental rates in India as of Q3 2024?
Mumbai has the highest rental rates in India as of Q3 2024, with an average rent of Rs 86.50 psf per month.
What factors are contributing to the increase in rental prices?
The increase in rental prices is driven by a strong quarter-on-quarter surge in rental demand and a decline in the supply of rental properties. Ready-to-move apartments are increasingly being purchased for self-use, contributing to the decline in rental supply.
Which city has the highest gross rental yield in India?
Ahmedabad has the highest gross rental yield in India, at 3.9%.
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