Rising demand for rental properties in India

March 6, 2023

For countless Indians, owning a home is the realization of a lifelong dream.  However, the pattern is shifting as renting a home becomes less expensive than buying one within the city limits or close to commercial districts. In the years following the pandemic, the rental housing sector has grown. As a result, there are numerous opportunities for individuals and businesses to seize in this market.Continue reading this blog to learn why rental housing demand in India is rising. 

India’s urbanization, migrant influx, and “Housing for All” missions fuel high demand for rental housing. Real estate prices in many countries are significantly higher than rental values, which has made owning a house more of an asset-building opportunity. For example, in Mumbai or Gurgaon, the price to rent ratio, calculated as Price of Property / Annual Rent of the Property, may be as high as 41, given that the price of a property in these cities top locations is around Rs 2 crore and the annual rent is approximately Rs 4,80,000. (Rs 40,000 per month).

Mumbai Houses

Why is the rental housing demand rising?

The rising demand for property is driven by various factors, including population growth, urbanization, low interest rates, and increasing wealth. A growing number of people are looking to rent homes in Indian cities, which have traditionally been thought of as wise investment options by generations. Additionally, cheap car loans and readily available cars in showrooms have led to overcrowded highways and long commuting times. In order to save time on their commutes and live more comfortably, millennials prefer to live closer to their workplaces. 

For all migrant populations who might not wish to make a long-term financial commitment in a city, rental housing offers a practical and affordable choice. It is the most accessible solution to the rising housing demand in urbanizing nations like India. Since renting a property gives the migratory population more mobility and freedom, especially in places with high capital values, it becomes a preferable option for tenants across the economic spectrum. The rising demand for property is a global trend that is being driven by various factors. 

Mumbai Ongoing Project

Rental Market in India

The rental market in India has seen significant growth in recent years, driven by factors such as urbanization, a growing middle class, and increasing affordability of housing. However, high prices and competition for rentals are concerns due to lack of standardized agreements and absence of a unified rental law.

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