Rental Values Outpace Home Prices in Many Indian Cities: ANAROCK Data

Mumbai / September 18, 2024: New data from ANAROCK Research reveals a significant surge in rental values across India’s top cities, outpacing capital appreciation in many areas. This trend has ignited renewed debate and uncertainty among potential homebuyers, prompting them to reconsider whether it’s more financially prudent to buy or rent a property.

ANAROCK Research data shows that rental values in key micro-markets of the top 7 cities have gone up to a significant 72% between 2021-end and H1 2024, while capital values saw lower growth, a statement from ANAROCK Research said. 

Dr. Prashant Thakur, Regional Director & Head, Research – ANAROCK Group, said, “Data analysis of key micro-markets in the top 7 cities shows that in cities like Bengaluru, Pune, Kolkata and Chennai, average residential rental values rose more than the capital values between 2021-end to H1 2024. However, areas in NCR, MMR and Hyderabad saw the reverse trend – capital values appreciated more than the rental values. Such data can be a key parameter – though by no means the only one – used to determine whether it is more advantageous to buy a property or opt for renting.”

Top markets where rental value growth outpaced capital value appreciation – 2021-end to H1 2024-end

Bengaluru’s Sarjapur Road saw average monthly rental values increase by 67%, while capital values increased by 54%. At Thanisandra Main Road, average. rental values rose 56% while capital values appreciated 52%.

Pune’s Hinjewadi saw rental values appreciate by 52%, while capital values rose just 31%. In Wagholi, rental value growth was 60% while capital values rose by just 30%.

In Kolkata’s EM Bypass, rental value appreciation was 46%, while capital values growth was just 15%. In Rajarhat, rental value growth was 30% while capital appreciation was 23%.

Chennai’s Pallavaram recorded rental value growth of 40%, while capital values rose by 18%. At Perambur, rental value growth was 33% while capital appreciation was 18%.

Top markets where capital value appreciation outpaced rental value appreciation – 2021-end to H1 2024-end

Key micro-markets in NCR, MMR and Hyderabad witnessed this trend. For instance:

NCR’s Sohna Road saw rental values rise 40% in the period, while capital values jumped by 54%. Likewise, Sector-150 in Noida saw rental value growth of 56%, while capital values appreciated by a whopping 126%.

In MMR’s Chembur, rental growth was 38% while capital appreciation stood at 39%. In Mulund, rental values appreciated by 26% while capital prices rose 36%.

Hyderabad’s HITECH City and Gachibowli also saw capital appreciation outpace rental values. In HITECH City, rental value growth was 46% and capital appreciation was 59%, while Gachibowli saw rental values rise 50% and capital values by 70%.