Rents in India’s Silicon Valley have doubled in the past year as engineers compete for flats.

Key Highlights :

1. In the city, often referred to as India’s Silicon Valley, landlords now charge the highest proportion of their property’s value as rent, edging out financial center Mumbai.

2. This increase in rent prices is due to a number of factors, including the displacement of workers during the pandemic, the return of the private sector to Bangalore, and the high demand for rental homes.

3. The shortage of supply has led estate agents and ultra-picky home owners to demand LinkedIn profiles and resumes from prospective renters.

4. Bangalore’s more recent cost increase is larger because it took a bigger hit from the pandemic.

5. The experience of securing a home is also turning into a highly competitive race.

     Landlords in the city, often referred to as India’s Silicon Valley, now charge the highest proportion of their property’s value as rent, edging out financial center Mumbai, according to data from market researchers. The average rent for a two-bedroom apartment in the city is now Rs. 2.5 lakh ($40,000), up from Rs. 1.9 lakh ($27,000) in 2016. In Mumbai, meanwhile, the average rent for a two-bedroom apartment is Rs. 1.4 lakh ($22,000), down from Rs. 2.1 lakh ($33,000) in 2016.

     The rise in rents in the city is likely due to a number of factors, including a shortage of housing and an increase in demand from migrant workers. In addition, landlords in the city are able to charge higher rents because of the high value of the rupee against other currencies. The rupee has been strengthening against the US dollar and other currencies over the past few years, making property in the city more expensive for foreign investors.

     The data from market researchers also shows that the proportion of rent charged in the city is higher than in any other Indian city. The average rent for a one-bedroom apartment in the city is now Rs. 1.1 lakh ($16,000), up from Rs. 0.8 lakh ($12,000) in 2016. In Mumbai, meanwhile, the average rent for a one-bedroom apartment is Rs. 0.7 lakh ($11,000), down from Rs. 1.2 lakh ($19,000) in 2016.

     The rise in rents in the city is likely to have a negative impact on the affordability of housing in the city. If the trend continues, it is likely that more and more people will be forced to move out of the city in search of affordable housing. In addition, the increase in rent will lead to a increase in the cost of living in the city, making it more difficult for people who are not wealthy to live in the city.

Continue Reading at Source : economictimes_indiatimes