India’s rental housing market maintained robust momentum in the second quarter of 2025, with Greater Noida emerging as the top performer. According to data from property services platform Magicbricks, the township in Uttar Pradesh some 60 km from Delhi saw a significant 20.7 percent quarter-on-quarter (QoQ) increase in rental demand—the highest among all urban centres nationwide.
Navi Mumbai and Delhi closely trailed with a 19.4 and 17.2 percent escalation, respectively, in rental rates, highlighting the growing preference for renting over homeownership in major metropolitan areas.
Data showed that housing rental rates saw substantial escalations in Kolkata (13.7 percent), Ahmedabad (12.2 percent), Hyderabad (11.5 percent) and Chennai (11.2 percent), contributing to an overall robust rise in rents across India.
Data also showed that on the national level, the average housing rent surged by 4.8 percent sequentially while on a yearly basis, it grew a healthy 29.6 percent.
Market observers said that this surge in rental values is significantly influenced by improved labour mobility and urban migration, particularly boosting demand for rental accommodation in key Indian cities. They said that these trends indicate a strategic shift from ownership to occupancy in cities with strong rental traction.
The supply of rental homes across India also increased considerably, with Greater Noida (12.6 percent) and Chennai (11.4 percent) leading quarterly supply growth, and Mumbai (23.4 percent), Navi Mumbai (22.7 percent) and Noida (22.3 percent) showing a sharp increase in rental listings from a year earlier.
Sudhir Pai, the Magicbricks CEO, said that the rental market is evolving in step with India’s urbanisation story.
“Beyond the numbers, what we are witnessing is a deeper structural shift—tenants are increasingly embracing a ‘rental-first’ lifestyle, prioritising flexibility, well-connected locations and affordability. This expansion in supply is not just bridging the demand-supply gap but also supporting this cultural transition, meeting the aspirations of a mobile, affordability conscious and experience-driven urban workforce,” he said.
Pai added that the surge in supply, particularly in markets like Mumbai and Noida, is a clear reflection of heightened investor activity, faster project completions and the growing recognition of rentals as a viable and lucrative real estate segment.
Shifting tenant preferences
The data also highlights a shift in tenant preferences, with compact 1BHK units gaining traction while 2BHK homes remain the most popular nationwide, reflecting a strong demand for affordability and flexibility.
The rise in demand for 1BHK units was seen particularly in Navi Mumbai (27 percent QoQ), Gurugram (23 percent), Pune (19 percent) and Noida (18 percent), while demand for larger 3BHK homes declined in markets like Gurugram, Delhi, Ahmedabad and Noida, reflecting a downsizing trend.
Nationally, 2BHK units remained the most sought-after (46 percent share), and semi-furnished units continued to dominate the rental market with a 52 percent share of demand and 53 percent share of supply, data showed.
Homes ranging from 500 to 1,500 square feet attracted the majority of tenant interest. The Rs 10,000-20,000 per month range led rental demand nationally, with Mumbai continuing to be the most expensive rental market, while Greater Noida, Ahmedabad and Noida offered more budget-friendly options.
Ahmedabad, Chennai, Hyderabad and Navi Mumbai observed the highest quarterly gross rental yield of 4.1 percent, the data showed.
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