Hyderabad’s residential rental market has seen sharp hikes since 2022, but its overall real estate trajectory and market structure differ in important ways from Bengaluru, even as analysts say it is steadily narrowing the gap.​

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MC Explains | With rentals in Hyderabad hitting the roof, is the city’s real estate sector going the Bengaluru way? ​

Hyderabad, September 7, 2023: Rentals across Hyderabad’s key IT corridors have surged by 20–30 percent since 2022, pushing many tenants to renegotiate leases, shift to co-living, or move further out, and raising the question of whether the city is now mirroring Bengaluru’s high-rent real estate playbook.​

Rentals surge in western Hyderabad

Hyderabad’s rental spike is most visible in the western IT belt covering HITECH City, Gachibowli and Kondapur, where average monthly rents for standard 2BHK–3BHK apartments have jumped by around 19–20 percent between 2019 and 2023. In HITECH City, average rents have risen from about ₹23,000 a month in 2019 to nearly ₹27,500 in 2023, while Gachibowli has moved from roughly ₹22,000 to over ₹26,500 per month in the same period, with similar double‑digit growth recorded in Kondapur.​

Local brokers report far steeper hikes for many sitting tenants, with some 2BHK units that were leased for ₹32,000 in 2022 being re‑listed at ₹45,000–48,000 in 2023 as landlords test the new demand-supply equation. This has forced a section of young professionals and mid-career tenants into co‑living spaces, shared accommodations, or smaller units, even as the city continues to be perceived as relatively more affordable than Mumbai, Delhi‑NCR or central Bengaluru.​

How Hyderabad compares with Bengaluru

Data from ANAROCK and other consultancies indicates that Hyderabad’s core IT micro-markets have actually commanded a rental premium over comparable Bengaluru corridors since at least 2019. For instance, average monthly rent in Hyderabad’s HITECH City was about ₹23,000 in 2019 versus around ₹21,000 on Bengaluru’s Sarjapur Road; similarly, Gachibowli at roughly ₹22,000 was ahead of Bengaluru’s Whitefield at about ₹19,000 that year.​

The post‑pandemic rental upswing, however, has been more dramatic in Bengaluru, where a severe supply squeeze in popular IT belts led to near‑doubling of rents in some localities like Sarjapur Road and HSR Layout by early 2024. In contrast, Hyderabad’s higher new‑supply pipeline in western suburbs kept the pace of rent escalation somewhat more contained, even though cumulative increases of 20–30 percent since 2022 in many pockets have narrowed the gap further between the two southern tech hubs.​

Supply, geography and demand drivers

One key structural difference lies in geography: Hyderabad’s major IT hubs are concentrated largely in the western corridor, while Bengaluru’s technology clusters are spread across north, east and south, including Whitefield, Outer Ring Road, Electronic City and North Bengaluru. This concentration has meant intense, sustained pressure on rentals in areas like HITECH City, Gachibowli, Kokapet and the Financial District, even as north and east Hyderabad continue to offer relatively more affordable housing options near logistics and data‑centre hubs.​

Hyderabad’s rental boom is also being powered by a steady influx of IT/ITeS staff and Global Capability Centres, with developers and corporates citing lower operational costs, supportive state policies and improving infrastructure as key reasons to expand here instead of adding all new capacity in Bengaluru. Analysts note that housing prices in Hyderabad rose by about 64 percent between 2019 and the first half of 2024, outpacing Bengaluru’s roughly 57 percent during the same period, underscoring how the city has rapidly caught up in both capital values and rental growth.​

Is Hyderabad going the ‘Bengaluru way’?

On absolute levels, average city‑centre rents in Hyderabad are still typically lower than prime Bengaluru locations, with one estimate placing 1BHK rents in Hyderabad’s core at around ₹15,900 versus roughly ₹18,000 in Bengaluru. Yet in high-demand IT corridors, the percentage jumps in Hyderabad are now comparable to the spikes seen in Bengaluru during its post‑Covid rental surge, particularly for mid‑segment and furnished 2BHK–3BHK apartments.​

Experts quoted in recent market studies argue that while Bengaluru is entering a phase of relative stabilisation after a three‑year bull run, Hyderabad’s real estate story has more headroom, driven by a mix of still‑affordable ticket sizes, strong job creation and land‑bank availability in growth corridors such as Kokapet and the extended western arc. In that sense, Hyderabad is increasingly “going the Bengaluru way” in terms of rental heat and investor interest in its tech belts, but with a somewhat deeper supply cushion and a wider affordability band that may prevent the kind of extreme, city‑wide rent shock Bengaluru experienced in 2023–24.​

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