Residential capital values in Bengaluru, the Mumbai Metropolitan Region (MMR), the National Capital Region (NCR), and Hyderabad outpaced rental growth from late 2021 to the end of 2024, while Pune, Kolkata, and Chennai saw the opposite trend, according to a report by real estate consultancy Anarock, as published by the Hindustan Times.
Anarock’s analysis revealed that Noida’s Sector 150 experienced a 128% increase in housing prices over three years, with average capital values more than doubling to ₹13,000 per square foot from ₹5,700 per square foot. Meanwhile, rental values in the area climbed 66%, rising from ₹16,000 to ₹26,600 per month.
Gurugram’s Sohna Road saw capital values increase by 59%, reaching ₹10,500 per square foot by the end of 2024, up from ₹6,600 per square foot in late 2021. Rental values also rose 47%, growing from ₹25,000 to ₹36,700 per month.
Across the top seven Indian cities, capital appreciation surpassed rental growth in Bengaluru, MMR, NCR, and Hyderabad. Bengaluru’s Thanisandra Main Road saw capital values rise 67%, compared to a 62% increase in rental values. However, on Sarjapur Road, rental values increased by 76%, outpacing capital value growth of 63%.
In Hyderabad, key micro-markets like HITECH City and Gachibowli saw capital values outpace rental growth. MMR’s Chembur recorded a 48% jump in capital values, while rentals grew by 42%. In Mulund, capital values rose by 43%, compared to a 29% increase in rental values.
In contrast, key micro-markets in Pune, Kolkata, and Chennai saw rental values appreciate more than capital values. Pune’s Hinjewadi recorded a 57% jump in rentals, while capital values increased by just 37%. In Wagholi, rental values surged 65%, compared to a 37% rise in capital values.
Kolkata’s EM Bypass saw rental appreciation of 51%, significantly higher than the 19% growth in capital values. Rajarhat followed a similar trend, with rentals increasing by 37% while capital values grew 32%.
Chennai’s Pallavaram saw rental values climb 44%, while capital values rose 21%. In Perambur, rental growth stood at 36%, outpacing a 23% increase in capital values.
The disparity between capital appreciation and rental growth highlights evolving investment dynamics in India’s major cities. Markets where capital values are rising faster than rental yields—such as Noida, Hyderabad, and MMR—are becoming increasingly lucrative for long-term investors.
“An analysis of key micro-markets in the top seven cities shows that in Bengaluru, MMR, NCR, and Hyderabad, capital values have risen more than rental values,” said Anuj Puri, chairman of Anarock Group. “Meanwhile, Pune, Kolkata, and Chennai have seen the reverse trend, with rental values appreciating more than capital values.”
The report suggests that investors should align their strategies based on location-specific trends. Those focused on long-term capital appreciation should target areas with high price growth, while rental-driven investors may benefit from localities where rental values are rising steadily. For homebuyers, evaluating property price trends against rental growth is essential to making informed financial decisions about whether to buy or rent in a given market.