Reopening of offices and schools after a long hiatus of almost two years has encouraged people to take a leap and return to the cities from their hometowns. This has given an impressive boost to the rental homes sector in the top six Indian cities, as clearly reflected in the Q-on-Q data shared by Square Yards.
After a year and a half of covid-imposed restrictions, the world is gradually coming back to the one we knew of, before Covid hit. The residential real estate sector across top Indian cities is no exception. In the spring of the year 2020, people were deemed clueless when Covid hit, and everyone had rushed back to their family homes. This rendered rental homes across Indian cities devoid of tenants, sending the demand-supply curve for a toss.
Now that most of the population is vaccinated and we have gained a better understanding about managing the virus, people are coming back to their normal before-pandemic lives. This means offices will also gradually start to move away from work-from home, at least partially. A lot of the workplaces have already resumed normal office timetables while some have shifted to a hybrid work model; in both the cases people are required to visit their respective places of work. Further, schools have also reopened, albeit with rosters in place, and students are required to attend their classes offline. These two major shifts have forced people to come back to cities, thus giving a boost to the residential rental market. After being devoid of a vibrant lifestyle for this long, a lot of people are also coming back to the cities so they can get their pre-covid lives and lifestyles back.
These developments have had a positive impact on the searches for rental accommodations across top cities. As per data with Square Yards, the top six Indian cities –witnessed a huge surge in the number of prospective tenants looking for rental homes in Q3, 2021.
NCR seems to be leading the way in the revival of the rental market with Gurugram and Noida registering a significant Q-on-Q growth of 91% and 81% respectively. Searches for rental accommodations in MMR too shot up in Q3, 2021 recording a quarterly growth of 68% compared to Q2. Witnessing a 52% growth from the last quarter, Pune rental market was not behind. Bengaluru and Hyderabad rental markets also registered 47% and 45% rise in rental homes’ demand, respectively.
Rental price Trend After Covid
Boosted by an increase in demand, rental prices are also rising back to their pre-pandemic levels. A majority of the landlords had to offer rent concessions and had suffered losses due to the pandemic. They are now trying their best to cover up these losses and hence an increase in rentals can be expected in the near future.
Gurugram Demand Trends – Q3, 2021
An excessive supply of builder floors in the city this past one decade means they are available in big numbers for rental needs. They provide people the required privacy and that also reflected on the online searches for this quarter. More than half the rental searches in Gurugram were for builder floors. This was followed by one-third searches for apartments.
Mostly people searched for 2 BHK units so better space allocation could be ensured. 33% online searches were for 1 BHK units while 22% searches were for 3 BHK units. Configurations bigger than that were not very popular among people looking to rent a home.
501-1000 Sq. Ft. area range was the most popular, primarily because the supply for this size range is rampantly available in Gurugram.
Noida Demand Trends – Q3, 2021
While one-fourth of the searches in Noida were for builder floors, the preference lied with apartments. Almost 60% of the online rental home searches were for apartments. 43% searches were for 2 BHK homes and 36% searches showed people’s interest in 1 BHK units. Noida online search data shared a similar sentiment with other top four Indian cities.
Following the trend in Gurgaon, Noida searches also reflected people’s interest in rental homes with area ranging between 501-1000 Sq. Ft.
Hyderabad Demand Trends – Q3, 2021
Hyderabad residential rental market trends in Q3 were more or less the same as that of the other top Indian cities. 66% online searches were for apartments, specifically in the size range of 501-1000 Sq. Ft. 2 BHK configuration type was the most searched in Hyderabad.
MMR Demand Trends – Q3, 2021
The majority of MMR localities are mushrooming with apartments and that is the most preferred way of life for many there. This was reflected in the online search trends for rental accommodations in MMR during Q3. A whopping 98% searches were for apartments. Half the searches were for units sized between 501-1000 Sq. Ft. homes. 1 BHK units were the most searched, shaping the rental trends in the city for the coming months.
Pune Demand Trends – Q3, 2021
Sharing the sentiment with MMR, online searches for Pune also showed people’s inclination towards apartment-style living. More than half the searches were for 1 BHK units, as was the case in MMR. Searches were biased towards the 501-1000 Sq. Ft. size range in Pune too.
Bengaluru Demand Trends – Q3, 2021
The Silicon Valley of India is ready to open again and that can clearly be reflected in the demand surge for rental homes. It witnessed a spike of almost 50% in the demand for rental homes on a Q-on-Q basis. 40% searches were for apartments, and mostly people showed interest in homes with areas ranging between 501-1000 Sq. Ft. 2 BHK units were the most preferred configuration type in Bengaluru.
