To Rent or To Buy: Unraveling the Mystery of India's Top 7 Cities
Anarock Research data reveals that rental values in key micro-markets of top 7 cities have increased by up to 72% between 2021-end and H1 2024, while capital values saw lower growth.
Rent Vs BuyProperty InvestmentIndian Real EstateAnarock ResearchHome Loan Interest RatesReal Estate MumbaiSep 23, 2024
Recent data from Anarock Research shows that rental values in key micro-markets of these cities have increased significantly between 2021-end and H1 2024. In some cities like Bengaluru, Pune, Kolkata, and Chennai, average residential rental values rose more than the capital values during this period.
For instance, Bengaluru's Sarjapur Road saw average monthly rental values increase by 67%, while capital values increased by 54%. Similarly, Pune's Hinjewadi saw rental values appreciate by 52%, while capital values rose just 31%.
However, in cities like NCR, MMR, and Hyderabad, the trend was reversed, with capital values appreciating more than rental values. NCR's Sohna Road saw rental values rise 40% in the period, while capital values jumped by 54%.
According to Dr. Prashant Thakur, Regional Director & Head, Research – Anarock Group,
Frequently Asked Questions
What is the main factor that determines whether it is more advantageous to buy a property or opt for renting?
Data analysis of key micro-markets in the top 7 cities shows that in cities like Bengaluru, Pune, Kolkata, and Chennai, average residential rental values rose more than the capital values between 2021-end to H1 2024. However, areas in NCR, MMR, and Hyderabad saw the reverse trend – capital values appreciated more than the rental values.
What are the benefits of buying a property over renting?
Buying a property provides the security of owning a physical asset, and current trends indicate that this sentiment is becoming increasingly popular. Additionally, homebuyers can avail of various tax benefits, including deduction on principal repayment and stamp duty & registration charges, deduction on repayment of interest charges, and a further deduction of Rs 50,000 for first-home buyers.
What is the current trend in home loan interest rates in India?
Home loan interest rates are currently averaging between 8.75% and 9.5%, making it a relatively cheaper option for homebuyers.
What are the factors that drive the decision to rent or buy a property?
Factors that drive the decision to rent or buy a property include financial wherewithal, job growth prospects, stage of life, size of family, and personal preferences.
What is the impact of the coronavirus pandemic on the decision to rent or buy a property?
The coronavirus pandemic has led to an increasing number of tenants seeing rent as an expense, and EMIs as SIPs towards a non-volatile asset. This trend has not abated since then, and more Indians are taking a hard look at what they can fall back on when things go south.
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