India Rental Housing Market Size, Share, Trends, Report and Statistics 2025-2033

India Rental Housing Market Overview

The India rental housing market size reached USD 2.7 Billion in 2024 and is expected to grow to USD 4.0 Billion by 2033, exhibiting a CAGR of 4.56% during the forecast period of 2025-2033. The market is driven by rapid urbanization, migration, rising property prices, and increasing demand for affordable housing options such as apartments, independent houses, co-living spaces, and PG accommodations catering to various income segments.

India Rental Housing Market Study Assumption Years

Base Year : 2024
Historical Year/Period : 2019-2024

India Rental Housing Market Key Takeaways

Current Market Size : USD 2.7 Billion
CAGR : 4.56%
Forecast Period : 2025-2033
The market growth is propelled by rapid urbanization with migration to urban centers fueling rental housing demand.
Rising property prices, especially in metros like Mumbai, Delhi, Bangalore, and Hyderabad, are increasing the affordability gap, driving rental demand.
Government policies including the Model Tenancy Act and Pradhan Mantri Awas Yojana (PMAY) support a structured rental framework.
Increasing preference for affordable rental housing complexes and co-living spaces caters to students, professionals, and families.
The industrialization and development of IT/corporate parks contribute to higher demand for rental accommodations.

Request Free Sample Report: https://www.imarcgroup.com/india-rental-housing-market/requestsample

India Rental Housing Market Growth Factors

The India rental housing market is primarily driven by rapid urbanization and migration to cities, attracting millions seeking better job opportunities and improved lifestyles. According to World Bank Group forecasts cited in the report, by 2036, 600 million people (40% of India’s population) are projected to live in urban areas, up from 31% in 2011. This demographic shift significantly increases rental housing demand, especially in Tier-1 and Tier-2 cities, as most working professionals and students prefer renting over buying due to the high cost of properties and job mobility.

Rising property prices and affordability challenges play a crucial role in market growth. Capital values in the National Capital Region have risen sharply, with a 128% increase to Rs 13,000 per square foot in recent years. Areas like Sohna Road in Gurugram saw a 59% increase from 2021 to 2024. These escalating costs, combined with high down payments, elevated home loan interest rates, and maintenance expenses, make homeownership less viable for middle and lower-income groups, increasing preference for rental housing.

Government policies and housing schemes also bolster the market. The implementation of the Model Tenancy Act has introduced a structured rental framework protecting tenants and landlords, reducing disputes and encouraging investment in rental properties. Programs like Pradhan Mantri Awas Yojana (PMAY) and Smart Cities Mission are designed to promote affordable rental housing, with incentives aimed at private sector participation and support for migrant workers’ accommodation. The focus on Affordable Rental Housing Complexes (ARHCs) highlights continued commitment to expanding rental housing availability.

India Rental Housing Market Trends

The India rental housing market is witnessing several key trends. Urbanization continues unabated, with migrants shifting to cities for employment and education, deeply driving rental demand. Professionals and students increasingly favor renting, attracted by its flexibility amidst frequent job changes and the prohibitive cost of homeownership.

The surge in rental requirements is prominently visible in metro and Tier-1/Tier-2 cities backed by the expansion of industrial zones, IT parks, and corporate offices that increase demand for nearby rental accommodations. Government initiatives such as the Smart Cities Mission and infrastructure upgrades are further strengthening urban rental market dynamics.

Affordability remains a pivotal concern due to rapidly rising property prices in major urban areas, leading to a widening gap between income levels and homeownership feasibility. The capital values in regions like NCR and Gurugram have sharply escalated. This affordability issue nudges middle and lower-income groups toward rental housing solutions.

Government support through legislative reforms like the Model Tenancy Act fosters a more regulated rental market by protecting both landlords and tenants, reducing conflicts, and encouraging more housing stock in rental segments. Meanwhile, affordable rental housing schemes aimed at migrant workers, though in nascent stages, promise long-term market expansion.

The increasing popularity of co-living spaces, PG accommodations, and affordable rental housing complexes reflects changing consumer preferences targeting short-term and flexible rental solutions for professionals, students, and families.

India Rental Housing Market Segmentation

Type Insights:

Standalone Spaces: Independent units catering to individual rental needs.
Society Based: Rental housing situated within residential societies providing shared amenities.

Size of Unit Insights:

Up to 400 square feet: Compact rental units suitable for single occupants or couples.
400-800 square feet: Medium-sized units balancing space and affordability.
Above 800 square feet: Larger units accommodating families or groups seeking more space.

Property Type Insights:

Fully Furnished: Rental properties equipped with complete furniture and appliances.
Semi-Furnished: Properties with partial furniture or appliances provided.
Unfurnished: Bare rental units without furniture, allowing tenant customization.

Regional Insights

North India
South India
East India
West India

The North India region generally dominates the rental housing market due to significant urban and industrial development. The overall market is projected to grow at a CAGR of 4.56% during 2025-2033. This growth is fueled by expanding urbanization and increasing property prices across these regions.

India Rental Housing Market Recent Developments & News

In March 2025, the Haryana government launched the Affordable Rental Housing Scheme under PMAY (Urban) 2.0 to provide budget-friendly rental homes to EWS and informal sector workers. The pilot program includes leasing 1,600 apartments in Sonipat with a budget allocation of Rs 2444.27 crore for 2025-26.
In February 2024, the Government of India announced plans for a new program assisting middle-class segments in purchasing or building homes. The Union Finance Minister mentioned this initiative targets middle-class residents living in rental homes, slums, chawls, or unapproved colonies.

India Rental Housing Market Key Highlights of the Report

Comprehensive quantitative analysis of market segments and historical and current trends.
Detailed market forecasts between 2025 and 2033 covering type, unit size, property type, and region.
Assessment of industry catalysts, challenges, and competitive landscape including company profiles.
Inclusion of Porter’s five forces analysis to evaluate market competitiveness.
Insights into government policies and their impact on rental housing demand.

India Rental Housing Market Key Players

The report offers an in-depth examination of the competitive landscape, including market structure, key player positioning, leading strategies for success, a competitive dashboard, and a company evaluation quadrant.

Get Your Customized Market Report Instantly: https://www.imarcgroup.com/request?type=report&id=31003&flag=E

If you require any specific information not covered within this report’s scope, we will provide it as part of the customization.

About Us

IMARC Group is a global management consulting firm that helps ambitious changemakers create a lasting impact. The company offers comprehensive market assessment, feasibility studies, incorporation support, regulatory assistance, branding and strategy services, and procurement research.

Contact Us

IMARC Group

134 N 4th St. Brooklyn, NY 11249, USA

Email: [email protected]

Tel: (D) +91 120 433 0800

United States: +1-201971-6302