Rising Property Prices Drive 25% Rent Increase in Major Indian Cities in 2025
Rising property prices over the past few years have driven rents in prime residential micro-markets in Mumbai, Delhi, Bengaluru, Noida, and Gurugram up by 25% in 2025, pushing many employees to relocate farther from key office hubs. Return-to-office mandates, an influx of high-income households, and strong corporate leasing demand have also added to the rental spike, industry experts said. They expect this trend to continue this year.
In 2026, we expect rentals to remain on an upward trajectory, with more growth towards established corridors, while affordability pressures may push incremental demand towards peripheral locations, said Shveta Jain, MD, residential services at Savills India.
According to Savills, rent in Mumbai's micro-markets rose 1-20% in 2025. The market gained momentum amid strong demand for leasing larger homes in projects with amenities. The rise in rent can be partly attributed to pent-up demand for rental properties due to the redevelopment of dilapidated buildings.
In Gurugram, rentals of luxury properties grew 8-25%, show Savills data. Dwarka Expressway and Golf Course Road witnessed the fastest growth, with average rents rising by 25% and 20%, respectively.
Top executives prefer to stay near the office, and that is the reason why luxury rentals continue to go up, as these complexes are located near office hubs. Mid-segment employees have to move to peripheral areas to save on rent, though there, too, there has been a substantial increase in rentals, said Shauzab Kazmi, director at real estate consultancy Moneytree Realty.
Properties located near metro stations witnessed a substantial increase in rental values. In Bengaluru, rents surged by 18-20%, driven by sustained corporate and expatriate demand and limited new completions in premium micromarkets. In Noida, the expressway recorded the fastest growth in average rentals, witnessing annual appreciation of 19% in 2025 compared with 2024.
Noida saw the launch of 2,257 luxury units, reflecting a 17% decrease from 2024 levels.
While most of the real estate development is now focused in Noida and Gurugram, Delhi often beats (them) in rentals because of lack of availability. From luxury floors to boutique bungalows and farmhouses, the demand is constant and that pushed the rentals, said Pradeep Prajapati, founder of boutique real estate consultancy firm Wealthvisory Capital. In Delhi, average rental values increased to 19% year-on-year in 2025. South-East and South-Central micromarkets witnessed the highest growth with 19% and 11% on-year increase, respectively in average rentals.
