Bengaluru residents faced steep rental hikes in August 2023, prompting many to weigh buying homes against continued renting. Rents surged over 30% in key areas like Whitefield and Sarjapur due to post-pandemic demand outpacing supply.​

Rental Surge Drivers

Demand-supply gaps fueled the crisis as IT professionals returned to offices after COVID-19 lockdowns halted construction in 2020-2021. Landlords hiked rents by 30-40% to recover losses, with 2BHK units in Whitefield rising 31% and Sarjapur 27% in the first nine months. Average 1-2BHK rents jumped from ₹25,000 to ₹40,000-60,000 in IT hubs like Whitefield, Koramangala, and Bellandur.​

Rent vs Buy Factors

Renting offered flexibility for job transients but built no equity amid annual hikes of 20-30%. Buying promised long-term wealth through appreciating property values, though upfront costs like stamp duty and EMIs deterred some. In high-demand zones, EMIs often matched escalated rents, tilting sentiment toward ownership post-COVID for space and stability.​

Tenant Challenges

Prospective renters endured “job interview-like” processes, with landlords demanding resumes, LinkedIn profiles, and even 90%+ academic scores. Unmarried couples or non-vegetarians faced biases, while supply shortages in central areas exacerbated mental stress during house hunts.​

Market Outlook Then

Experts predicted stabilization by Q4 2023 as supply caught up, but January-March hiring seasons loomed to reignite demand. Bengaluru led India’s rental growth at 16-30%, outpacing Mumbai and Delhi-NCR’s 9-14%, amid 3.9% yields for landlords.​

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