New Delhi, November 18, 2024: Magicbricks, India’s leading real estate platform, published its latest Rental Update, highlighting that between July and September 2024, average rents increased 7.4% quarter-on-quarter (QoQ) across 13 major Indian cities[1] to INR 35.8 per square foot per month- the highest increase in the last 2 years.
Chennai recorded the sharpest increase at 22.2% QoQ, moving from INR 17.94 psf in Q2 2024 to INR 26.91 psf in Q3 2024. Delhi and Thane also saw significant jumps, with Delhi’s average rent rising 11.4% QoQ to INR 37.55 psf and Thane’s rent increasing 10.9% QoQ to INR 33.10 psf.
According to the report, Mumbai remains the priciest rental market at INR 86.50 psf per month, followed by Delhi at INR 37.55 psf and Navi Mumbai at INR 33.83 psf. Meanwhile, developing markets of Greater Noida (INR 15.48 psf), Noida (INR 21.32 psf), and Kolkata (INR 22.14 psf) are more affordable.
Elaborating on the same, Prasun Kumar, Chief Marketing Officer, Magicbricks “This year, rental demand has shown a strong quarter-on-quarter surge, driving rents to the sharpest increase we’ve seen over the past eight quarters. It’s evident that ready-to-move apartments are increasingly being purchased for self-use, contributing to a decline in rental supply. Meanwhile, the rise in under-construction supply suggests potential for market balance in the coming quarters, as more inventory becomes available.”
The report detailed that after a notable increase of 14.8% quarter-on-quarter (QoQ) in rental demand during the previous quarter (April to June 2024), the demand continued to increase, albeit at a slower pace of close to 2%. However, the supply of rental properties has not kept pace, declining by 6.7% QoQ in the third quarter (July to September). This imbalance between demand and supply has contributed to the upward pressure on rental prices.
The report concluded that gross rental yields across 13 cities reached 3.62%. Ahmedabad led with the highest yield at 3.9%, followed by Hyderabad, Kolkata, and Pune at 3.7% each. Chennai saw the largest QoQ yield growth at 21.3%, with Delhi, Hyderabad, and Navi Mumbai also reporting strong increases at 8.8%, 5.4%, and 5.3% respectively. However, Greater Noida, Gurugram, Kolkata, Mumbai, Noida, and Pune recorded declines as property price growth outpaced rental rate growth.