With several IT and other service-sector entities rolling back their remote work policies and mandating employees to begin working from office for at least 2-3 days each week, home rentals have witnessed an increase of 10-40% throughout leading metro cities and IT hubs like Delhi-NCR, Bengaluru, Mumbai, Chennai, Pune, and Hyderabad.
This could increase even more in the future, with more companies making work-from-office the new norm in 2024 and more employees migrating back to settle in metro cities. With young professionals selecting to live in closer proximity to their workplaces for improved work-life balance, the mismatch between supply and demand is visible across several city pockets. This has led to landlords gaining an upper hand in negotiations, with many of them seeking even the LinkedIn profiles of renters for job security and work history.
2 BHK units exceeding 1,000 sq. ft. and 3 BHK homes are the most coveted options with the highest rental appreciation seen for rentals in areas like Sarjapur Road and Whitefield in Bengaluru and Gachibowli in Hyderabad, along with Pune. Experts feel that residential rentals have shown an incredible comeback after the pandemic with the hotspots for future growth being cities that are inherently IT/ITeS-centric. More IT companies are making it compulsory to work from office for at least three days each week. Wipro has mandated a three-day office system from 15th November while TCS has also ended its remote working systems. Cognizant is yet to change its policies regarding hybrid work.
Average home rentals between October 2022 and October 2023 have increased by 12-24% for the leading service sector employment hubs which are Delhi-NCR, Bengaluru, Hyderabad, Pune, Mumbai, Chennai, and Pune. Experts feel that most employees who have children have already returned after the opening of schools. Several unmarried employees have also returned since they desire city lifestyles. Many more employees are also planning to return after Diwali and this may lead to a further increase in rentals.
The CBO and Co-Founder at Azuro, the leading rental and property management platform, Altaf Ahmad, states that the sudden rolling back of the work-from-home system has led to the rental housing market being taken by surprise with housing demand already surpassing pre-pandemic levels. IT professionals are already grappling with this hike in rentals, with more landlords looking to recover their lost revenues due to the pandemic by charging higher amounts. They are currently capitalizing on a presently robust seller’s market according to him.
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Times of India: https://bit.ly/47BPt4f
Published Date: Nov 16, 2023
