Home rents zoom 31% in top 7 Indian cities, IT hubs take the lead again

IT hubs witness 31 percent housing rental values growth

Housing rents continue to soar in the country's top seven cities, led by IT/ITeS hubs Bengaluru, Hyderabad and Pune. Among the top seven cities, rent in Bengaluru’s prominent areas soared by over 30 percent in the first nine months of 2023, ANAROCK Research data shows.

A standard 2BHK flat of approximately 1,000 sq ft in Bengaluru’s Whitefield saw rents grow by 31 percent in 9M 2023, followed by Sarjapur Road where the rent was up for such homes rose by 27 percent in this period.

In hard numbers, average monthly rent for a standard 2BHK home of 1,000 sq ft at Whitefield increased from Rs 24,600 a month by 2022-end to Rs 28,500 by September-end 2023. At Sarjapur Road, average monthly rents increased from Rs 24,000 in 2022-end to Rs 30,500 a month in September 2023, it showed.

“After an almost terminal downturn during the first and second Covid-19 waves, residential rents are one of the most remarkable comeback stories of the post-pandemic housing sector...

"Bengaluru, already in the limelight for its astronomic rental values post-Covid-19, continues to stand out among the top seven cities. The fact that the next two hotspots for rental values growth are also IT/ITeS centric cities also underscores the fundamental strength of the Indian Infotech sector, despite belt-tightening moves in the industry,” said Anuj Puri, Chairman, ANAROCK Group.

Hyderabad saw the second-best rental value growth with key markets in the city seeing up to 24 percent growth in this period against all prominent  localities in the top seven cities of India. These included Bengaluru, Hyderabad, Pune, NCR, MMR, Kolkata and Chennai.

In HITECH City, the average rents stood at Rs 24,600 a month by the end of  2022. By the end of Q3 2023, it was Rs 28,500 a month, a 16 percent growth in the nine-month period. Gachibowli saw rents zoom up by 24 percent in the same period – from Rs 23,400 per to Rs 29,000 by the end of September this year.

The third prominent city to see good rental values growth was Pune, where the Hinjewadi micro-market recorded a rental value growth of 17 percent over the past nine months. The average rent, which was Rs 21,000 a month at the end of 2022, spiked to Rs 24,500 the end of September.

Rentsmay begin to stabilise in most cities in the ongoing quarter as renting usually remains low in the last quarter of the year, Puri said. “Rents will once again build up steam when renting picks in the January to March period,” he said. “This is when Indians usually relocate for better job opportunities amid increased hiring in the new financial year.”