Magicbricks shared its latest Rental Update for January to March 2024. It showed that rents went up by 16% compared to the same time last year in 13 big Indian cities. Places like Greater Noida, Gurugram, and Bengaluru saw the biggest increases. The report also mentioned that rents went up by 2.8% compared to the previous quarter, which was a bit higher than the increase seen between October and December 2023.
Based on the preference of over 2 crore customers on Magicbricks platform, the report further observed that rental demand has increased a significant 16% QoQ during this period, led by Chennai (24.9% QoQ), Navi Mumbai (20.1% QoQ) and Noida (19.2% QoQ). However, the supply has increased marginally by 1.8% QoQ, due to swift absorption of available rental units.
Explaining the dynamics, Abhishek Bhadra, head of research, Magicbricks, elaborated, “Prior to 2020, residential rental yields in India were averaging around 3 percent. However, since 2022, following the resumption of office operations, we’ve witnessed a notable surge in rental demand, consequently driving up rents and offering higher yields to landlords. We anticipate this upward trend in rents to persist over the next few months, particularly as rental activity typically peaks in the first two quarters of the fiscal year. Notably, residential and IT hubs like Bengaluru, Gurugram, Hyderabad and Noida have experienced significant increases in their rental yields, in line with our expectations.”
The report also observed that the demand for rental accommodation within the budget of Rs 10,000 to Rs 30,000 per month is the dominant segment accounting for 42% of the total demand share.
