Rental prices cool down in April-June period
Average price growth drops 50% in top metro cities owing to a surge in housing supply, says ANAROCK
image for illustrative purpose
Bengaluru: After a surge in housing rental prices, more supply in the housing market is slowly leading to stabilisation of prices across metro cities. Real estate consultancy firm ANAROCK said average price growth drops 50 per cent in top metro cities owing to a surge in housing supply. The data from the real estate consultancy firm showed that average residential rental prices across key markets in the top cities saw a 2-4 per cent quarterly rise in Q2 2024 to date over the preceding quarter.
In the first quarter of 2024, rentals in these markets rise in the range of 4-9 per cent over the preceding quarter. Metro cities, where prices cooled down included Bengaluru, Hyderabad, Pune, NCR (National Capital Region), MMR (Mumbai Metropolitan Region), Kolkata, & Chennai, the data showed. “In India, the second quarter of most years typically sees rents increase more than in other quarters due to the commencement of the new academic year and the employment of new staff.
This year, declining rental value growth coincides with substantial new housing supply entering these markets.” Santhosh Kumar, Vice Chairman of ANAROCK Group said. According to the report, top seven cities are set to deliver around 5.31 lakh new units in 2024 while in 2023, these cities saw about 4.35 lakh units hitting their markets. Thus, a 22 per cent annual supply increase this year is likely to see further cooling of rental prices in metro cities.
Average rents for a standard 1,000 sq ft 2 BHK residential property in Bengaluru’s Whitefield rose by 4 per cent – from Rs 32,500 per month in Q1 2024 to Rs 35,000 per month in Q2 2024 to date. In Q1 2024, the quarterly was around 8 per cent.
“Hyderabad’s HITECH City and Gachibowli saw average rents rise by 3 per cent each in Q2 2024 to date over the preceding quarter. In Q1 2024, the quarterly average rent hike in both these markets was 5 per cent,” the report said.
Among the top seven cities, MMR is slated to see the highest completions (of residential properties) at around 1,60,900 units in 2024. In 2023, the region saw approximate 1,43,500 units completed.While Hyderabad is slated to see addition of 34,770 units in 2024, NCR is expected to see around 1,44,315 units delivered in 2024 as against 1,14,280 units in 2023. Bengaluru, the key rental hub with the highest rental value hikes, will however see less number of houses getting added at 51,685 units in 2024 as compared to 52,565
units in 2023.
