India's Rental Market is Out of Control!
7 May 2025 6:10 PM IST
We’re all familiar with India’s boom story–rising salaries, more disposable income and a demand for a better quality of life.
But, with many more young Indians migrating to big cities to work and earn, they’re finding it supremely challenging to pay rents, even on their relatively good salaries.
A 2024 report by AON group, a consulting company, found that salaries in India are rising at a rate of about 10% each year. At the same time, rental costs are rising at a phenomenal rate, of 16-20%, and sometimes even more.
In this episode, we'll learn about how rising rents are pushing young Indians out of big cities. And what are they doing to navigate that crisis?
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TRANSCRIPT
Kudrat (Host): I moved to Delhi a month ago, and like any new entrant to a city, I too had to look for housing. I looked everywhere–nice neighbourhoods, not-so-nice neighbourhoods, apartments that were furnished and those that were bare…
Honestly, I didn’t like most of what I saw. But, that’s all that actually fit within my budget. And, that seems to be the experience of a lot of young people. During COVID, rents had stalled for some time. But, a Businessline report found that since then, rents have been shooting up at a rate of 16% year on year.
Already, moving is no fun. Now, we also have to worry about increasingly unaffordable rents.
I am your host Kudrat Wadhwa and you’re listening to The Signal Daily. We don’t do hot takes—instead, we’ll bring you deep dives into the ‘how’ and 'why' of consumer culture.
In this episode, we’ll learn about how young Indians are navigating the country’s increasingly expensive rental markets.
Sso what's your experience been like? How's hunting in Delhi?
Meher: I. Um, I hate it. It's a lot difficult than I thought it would be, but yeah, I feel like the houses here are just, there's no ventilation row, there's no windows, and it's just like boxes stacked on top of each other, and it's so difficult because it's Delhi.
So you also need to see like your areas and your safety and if it's a gated society or not, and it's a big headache.. So I don't like it at all.
Kudrat (Host): Meher recently graduated from college and is now working as a Marketing Assistant at an art gallery in South Delhi. It’s her first job out of school, and she earns a salary of 35,000 rupees per month. According to the Ministry of Statistics and Programme Implementation, the average Indian in their early 20s earns about 6,000 rupees per month. but realistically speaking, her salary is still relatively low, given Delhi’s rents.
Meher said that her budget for housing is about 20,000 rupees. That’s technically a lot higher than what she should pay given her salary, but she’s lucky enough to have help from her parents.
So let's say you weren't getting help from your parents, um, yeah. Do you think you'd be able to find something within your sort of salary budget?
Meher: Um, no, I don't think so. I would find something, but I don't think I would be like. Satisfied with it, it would just be for like sustaining myself because I need to like find a place to live.
Kudrat (Host): Meher has her family’s financial support, but not all youngsters are that lucky. What of those young people whose families just cannot afford to help them out?
Not only that, high rents aren’t just a problem for those of us who are starting out in our careers.
A 2024 report by AON group, a consulting company, found that salaries in India are rising at a rate of about 10% each year. At the same time, rental costs are rising at a phenomenal rate. That’s true across most metro cities, but especially in Bengaluru. In this city, the overall rent inflation last year was between 24-35%, according to a Moneycontrol report that quoted Saurabh Garg, the co-founder of NoBroker.in.
Hold up, let me explain. Say, you’re living in Bengaluru and earning a salary of 50,000 rupees and paying a rent of 20,000 per month. Per the above numbers, next year, you’d earn 55,000 but pay a rent of 25 to 27,000 rupees. That means you’d actually be paying a significantly higher share of your salary in rent than just one year before.
Now, you might say that if you’ve already signed a lease with a landlord, they can only increase the rent by a certain percentage. In India, each state has their own version of the Rent Control Act, which generally dictates an upper limit for rent. But, reports show that many landlords, particularly those in Bengaluru and Mumbai, don’t follow those guidelines and increase rents by as much as 30% to match market rates.
This phenomenon of rising rents is also pushing young Indians out of big cities.
Abhishek: I'm Abhishek. I'm 31-year-old. I work with Times of India as a senior video editor.
Kudrat (host): Abhishek moved to Mumbai in 2012, when he was just 18, from his hometown of Karnal in Haryana. His dad worked as a photographer, meaning Abhishek grew up around cameras and saw them as his toys.
When Abhishek first moved to Mumbai, he lived in a PG, close to the institute he was studying fashion photography at. He says he lived with about 10 people in a two-bedroom apartment, and each of them paid 8,000 rupees each. Their rent went up by about 10-12% each year.
Abhishek: and one thing is very bad. In Mumbai, the broker thing, they charge, like every year they charge you brokerage. Every year, you have to pay the brokerage. Usse bhi zyaada jo chubtha tha.. more than rent. It is deposits. Hmm. There are no limits in the deposit
Kudrat (host): Mumbai has notoriously annoying brokers. Abhishek said that in Mumbai, brokers call you each year and you have to pay a brokerage fee even if you’re staying in the same apartment. In Mumbai, landlords also tend to demand unreasonable deposits. Abhishek said he often paid deposits equivalent to six months of his rent.
Abhishek stayed at the PG for five years, after which he got his own place. Living in Andheri, where his PG was, was way too expensive, so he got a place in Kandivali, in the outskirts of the city. He would commute to his office for almost two hours each way.
His work hours were long too, and during the week, he was only home for about seven hours. That means he got just about five hours of sleep.
Abhishek: so then I used to suffer from like the BP kind of issues and all because …obviously miracle blood pressure scenario may hypertension third stage and all.
So then me and my wife one day, we sat on the weekend and we were like,
and she was like, we have to choose now something. Tell me, she was like, no, may be the officer
Kudrat (host): Abhishek eventually did get his transfer to Noida approved. In Noida, he lives in a high rise building that’s only 12 minutes from his office. He says the rent too is within his budget.
Abhishek: The best part is deposit of then I problem, and the best part is brokerage. I have a rent car half. Then I, I was like very good. And then, uh, like last month I renewed my contract. And I was like.
The other, either, either broke egg, other.
Kudrat: Though Abhishek is happy with his move, rents wise, he says he misses the community he had formed in Mumbai.
Abhishek: but, uh, the thing is.
That is the,
so that is the thing.
So in that.
Kudrat (host): Moving to Noida was a financially sound decision for Abhishek and luckily, his manager agreed to transfer him. Now, his rent is much more affordable. But, moving cities is no joke.
Abhishek spent 12 years of his life in Mumbai–he had weekend rituals of meeting his friends. Were it not for Mumbai’s sky-high rents, he says he would’ve stuck to living in the City of Dreams.
We’re all familiar with India’s boom story–rising salaries, more disposable income and a demand for a better quality of life.
But, with many more young Indians migrating to big cities to work and earn, they’re finding it supremely challenging to pay rents, even on their relatively good salaries.
Yes, our salaries are increasing but certainly not at the rate that general costs, including rental costs, are hiking. Each rental surge becomes a glaring reminder of the widening gap between ambition and affordability, leaving many with their dreams hanging precariously in the balance.
That’s all for today. We’ll keep looking into how the housing market for young Indians is changing. You just heard The Signal Daily.We don’t do hot takes—instead, we’ll bring you deep dives into the ‘how’ and 'why' of consumer culture. The Core produces The Signal Daily, follow us wherever you listen to your favourite podcasts.
