House rent up by 18% across top luxury markets; Worli records highest rental growth

Home rents have been shooting up since the economy, schools and offices started reopening post covid. While the prices had plummeted during the pandemic, residential rental markets across the top 7 cities made a strong comeback in 2022. According to an ANAROCK report, the average monthly rental trends across the key luxury localities in the top 7 cities reveals that most markets have witnessed double-digit growth in the last two years, with only a few exceptions.

The report showed that the average monthly rentals in the prominent luxury micro-markets across the top 7 cities increased between 8-18% in the last two years. "Mumbai’s Worli saw the highest rental growth of 18% in the period – from INR 2 lakh per month in 2020 to INR 2.35 lakh in 2022 for luxury homes of minimum 2,000 sq. ft. area. This was followed by Bengaluru’s Rajaji Nagar, which witnessed a 16% jump in the same period – from Rs 56,000 in 2020 to Rs 65,000 in 2022," said the report.

Anuj Puri, Chairman, ANAROCK Group, said that residential rental demand skyrocketed across the top cities in 2022 with schools reopening and most companies calling employees back to offices. "Pent-up rental demand hitting the market has caused a demand-supply mismatch in many areas, resulting in monthly rental hikes. Also, post-Covid tenant preference has tilted towards large-size homes,” he said.

Meanwhile, capital appreciation in these luxury markets remained in single digits (between 2-9%) in the last two years. Bengaluru’s Rajaji Nagar witnessed the highest capital appreciation of 9%, with average prices increasing from Rs 5,698 per sq. ft. in 2020 to Rs 6,200 per sq. ft. in 2022.