Mumbai house rentals surge as companies bet on hybrid work culture

The Mumbai property market is setting new benchmarks not only in terms of number of registrations through outright sale deeds, but it has also been recording high growth in rental appreciation as most corporates push for hybrid work option as against a complete work from home mode.

More employees have returned to the city over the last one year and this has led to the rise in rental values of residential properties by almost 20% during this period. Residential demand, especially in the rental segment, started witnessing a sudden spike since last summer, said property brokers.

Many locations including central Mumbai, Bandra, Khar, Andheri, Powai, Malad, Chembur, Goregaon and Ghatkopar have seen the demand spike for well-managed housing societies.


"During the pandemic one could work from anywhere and I could select my location based on factors including cost of living and lifestyle choices. However, I returned to Mumbai in July and finding a suitable accommodation has added almost 15% to my cost. This has been an experience with my friends too as most companies have now adopted hybrid work options as against a complete work from home mode," said Prateek Joshi, an HR professional.

Rentals in the country's commercial capital have risen over 20% from a year ago, surpassing the average growth of 15% across India's top property markets, and 4.1% sequentially during the January-March quarter, showed data from Magicbricks.

"Everyone is back in the city and many families have upgraded their requirements and preferences thanks to the pandemic experience. There is very little supply available that matches these upgraded needs that has effectively led to the 15-18% escalation in rentals in good localities," said Ruchi Kishore Narang of realtor firm L Lachhmandas Co.

It operates in Bandra, Juhu, central Mumbai's Worli, Lower Parel and South Mumbai.

According to Narang, both supply and demand have been impacted as many societies are going in for redevelopment. Existing residents of these societies are looking for apartments in their same ecosystem rather than moving to different localities.

"Mumbai sees a steady influx of people and high demand for residences. However, the supply of new properties remains limited due to various factors such as land availability, cost of construction, and regulatory framework," said Siddhart Goel, head of Research, Magicbricks. "This demand-supply imbalance has led to an rise in rents for residential properties in Mumbai."