Rental Inflation In Mumbai :
You can dream in Mumbai and you can achieve in Mumbai. Well, that is the magic of Mumbai. Mumbai is a cosmopolitan hub and has the most diversified culture. Thousands of people migrate to Mumbai in search of jobs and employment. It has the highest number of migrants as compared to other metro cities. Because of migration, Mumbai has become crowded and there are space constraints too.
As the demand for rental flats has increased, it has affected rental inflation in Mumbai. Do you know that the rental inflation of MMR has increased to 18%? This includes Thane and Navi Mumbai as well. In 2018, 18% was the highest rental inflation in Mumbai among five Indian cities.
Firstly, flats in Mumbai are unaffordable because the cost is too high. And, now rents of flats have increased causing inflation. In fact, 18% is the maximum rental inflation according to a survey. Rental inflation has also affected other metro cities, but the percentage is not as high as in the case of Mumbai.
The Average Rental Increase
The rent in MMR saw a huge surge last year. The average figure was 21,000 against 17,000, which was in 2017. The rental inflation of other cities like Bangalore and Chennai also increased. For Chennai, it was 15% and for Bangalore, it was a 14% increase. Gurugram that is another commercial hub near Delhi also saw a surge in rental inflation. Rent inflation of Gurugram was 11%.
Another city that saw a surge in rent is Pune. Last year the rental inflation of Pune also increased to 7%. Pune is again a city where most people prefer to stay on rent rather than buy a flat.
More on Indian Rent Report
The Indian rent report stated that a survey on inflation is based on 2.5 lakh properties. The data of 2017 was considered as well for the rent inflation survey. The security deposit in Mumbai is highest followed by Chennai and Bangalore. In Mumbai, the average deposit amount was close to 80,000. In Bangalore, the average deposit is close to 1.3 lakhs and Chennai is close to 1 lakh.
The deposits also vary according to the place of rent. If the property is on the outskirts of Mumbai, then the deposit would be lower. If it’s in a prominent location, then the deposit would be higher.
According to the survey, different people rent on different needs. In Mumbai, the top priority for a rental is water supply. Close to 85% wish to rent on this basis. Some people rent based on security (76%), parking (48%) and lift (61%).
Actually, this depends on individual needs too. Most people also rent based on the location of the flat. 20% of people rent based on the swimming pool facility. Based on this survey, luxury is not important for rent. People prefer basic amenities like water supply and security to other facilities.
The Changing Dynamics
The value of brokerage service also keeps changing. In fact, a majority of people in MMR wish to purchase a flat rather than stay on rent. The percentage of tenants who want to purchase a flat is almost 52%. Meanwhile, 86% stated that the flat they buy would be for self-occupation rather than investment.
Buying a property for investment is tough in Mumbai. As property rates keep on fluctuating, it is not so easy to purchase a flat of your dreams. That is the reason most people opt for rent in cities like Mumbai and Pune.
According to a recent report, most women in Gurugram search for rental flats online. This has also affected the rental segment. Anyone would prefer to rent a flat without brokerage deal. If online rental options are fruitful, people would be drawn to such options first.
Rental options are far better as compared to brokerage deals. Online real estate portals have a separate listing for rental deals. You can search for rental flats online and your preferred location. The deals are transparent and direct. Women in metro cities mostly choose real estate portals rather than brokers.
The Right Accommodations
A live-in relationship is legalized in India. There has been a surge in rent because of live-in couples as well. The number of live-in couples in Bangalore and Pune has increased significantly. Even Mumbai has a high demand for rentals as far as live-in is concerned. Times have changed and most young students prefer to stay alone. Even the ones who prefer to work in different cities. The demand for rental flats has increased because of students and young professionals. They look for their space and prefer to rent a flat in metro cities.
Rental inflation in Mumbai is high, but still, most people prefer luxury rental flats. According to a survey, most people in 2018 opted for 2 BHK and 3 BHK flats. Earlier when people used to rent the ideal choice was 1 BHK. But, there has been a change in rentals too.
People want to stay in spacious flats and they shell out good rent for it. In 2018, only 8% of people chose 1 BHK or 1 RK as accommodation. In 2017, 16% of people had chosen 1 BHK flats. Changing trends in rents have affected people as well.
The real estate market is never steady. The rates keep changing with the change in the economy. There is a change in rental inflation too. The only thing that remains constant is the demand. Most people believe that renting a flat is easier. There can be a change in location and you do not have to worry about other expenses as well.
Online real estate portals have also a role to play in this. Flats have a listing on the site. You can find it according to your preference or location. Online real estate portals also offer good discounts on rents. It’s simple to select a rental flat on one click rather than contacting a broker. So many projects are being re-developed in Mumbai. But, demand for rental flats will never change. In fact, it will further increase with time.