How Delhi’s soaring rent is eating into savings, triggering a student housing crisis

“I make Rs 10,000 through household chores and cooking, of which I pay rent of Rs 4,000 for a single room. Sometimes it gets difficult to put food on the table,” says Sumitra, a mother of two living in Delhi’s Sangam Vihar. Two years ago, she paid Rs 3,000 for the same room – a bare-bones, sparsely furnished space that doubles as both her living and kitchen area. Her husband, a labourer in Noida, visits the family on weekends.

But Sumitra’s struggle to pay nearly half her income in rent points to a much larger crisis. Rents in India’s top seven cities, including Delhi, have surged by over 70 percent between late 2021 and mid-2024, according to a research report by property consultants ANAROCK Group. In Delhi, the rent for a one-bedroom flat has skyrocketed to Rs 5.18 lakh annually, roughly Rs 43,167 per month, according to a study by industry body CREDAI-MCHI. This staggering rise places Delhi among the most expensive cities in India for renters, with rental inflation in the capital now outpacing that of major global cities.

This crisis is hitting families and individuals, especially those who have migrated to the city for studies or in search of better employment opportunities. Over 20 lakh people moved to Delhi between 2001 and 2011 itself, as per the 2011 census, while the capital’s housing stock remained stagnant. 

Brokers told Newslaundry that the high demand and limited supply are the primary drivers of rents in the capital, but the preference of specific localities for their proximity to educational institutions or corporations, higher property rates, and demand for modern flats and contemporary amenities have also contributed to the rise in rents.  

Sushmita Pati, an associate professor at NSUL Bangalore and author of Properties of Rent - Capital, Community, and Politics in Globalizing Delhi, however, argued that the rent crisis cannot be solely explained by market forces. “There is monopolisation in the estate sector, allowing owners to create artificial supply deficits,” she says, adding that landlords often impose restrictions like “vegetarian-only” or “family-only” tenants, further driving up prices.

Pati explained that the ownership of property and rent is often with specific dominant communities, who disrupt supply and demand as they set their own terms and control access. She said that those outside these communities face restricted access, which leads to inflated rents and housing shortages, not reflecting the actual demand. 

Anuj Puri, chairman of ANAROCK Group, also stressed that the Delhi Rent Control Act, which permits landlords to raise rents by a maximum of 10 percent every three years starting from the lease agreement, should be strictly enforced “as the actual rent hikes suggest a different reality.” Meanwhile, the brunt of it is borne by the middle class, lower-income families, and students.

Accommodation crisis for students 

In Mukherjee Nagar, known as the hub for UPSC coaching, rents have shot up. Samay, a civil services aspirant, said that he shares a one-bedroom flat with a friend for Rs 11,000. “I only receive Rs 10,000 from home, so rent takes up half my budget,” he says, highlighting how even basic accommodations are becoming unaffordable for many.

Yashank, 24, a student who moved to Patel Nagar after the flooding incident in Old Rajendra Nagar in September, said that the rent for his new accommodation is cheaper by Rs 2,000. He now pays Rs 8,000 for a room after paying a one-time brokerage fee equivalent to 21 days of rent. In Old Rajendra Nagar, he paid Rs 10,000 for a single room. 

“Although the amenities in Patel Nagar are better, the room lacks ventilation,” said Yashank, adding that moving to a place with better amenities would cost him around Rs 16,000-Rs 18,000, which is beyond his monthly budget of Rs 12,000.

In Kamala Nagar, a popular area for North Campus students, a room now rents for Rs 15,000-18,000 per month, up from Rs 12,000-13,000 just two years ago. Rahul, a BCom student at Hansraj College, shares a single room with a friend to manage rent and other living expenses within his budget. “With rent, electricity charges, and other expenses, our monthly budget is around Rs 12,000-13,000.” 

Arjun, a Delhi-based broker, pointed to the gap in the demand and supply of rental accommodations. “There are more students wanting rooms in areas like Kamala Nagar than there are available spaces.” 

For Ishika, 19, a student at Laxmi Bai College, rising rents forced her to leave a PG in Ashok Vihar, where she paid Rs 12,000 for a double-sharing room, and moved to a shared flat with two friends for Rs 19,000. “It took me three months to find something within my budget.” 

Another student, who wanted to remain anonymous, shared the frustration faced by many. “Brokers and landlords know that demand is high, so they charge whatever they want for even shabby spaces.” 

Zero savings, fewer barsatis, difference in north-south rent 

Sheetal, 26, now pays Rs 8,000 rent for a one-bedroom flat in Masjid Moth of South Delhi, half of their monthly family income. “We have zero savings,” she says, recalling how they moved from Badarpur, where rent was just Rs 5,000, due to her husband’s job location.

Jeetu, a broker based in South Delhi, told Newslaundry that low-income families usually have a fixed budget and prefer houses in areas like Arjun Nagar and Masjid Moth, where a one-bedroom can be rented for around Rs 10,000. Local broker Arjun said that till two years ago, one could find a room for Rs 2,000 in the interior areas of Sangam Vihar, but even they cost Rs 3,000 now.   

Rohtas, a broker who helps journalists find flats, says, “Lajpat and Jangpura in South Delhi are preferred by many clients because of their colonies and affordability.” Meanwhile, in Defense Colony, an upscale area, rent for a two-bedroom semi-furnished flat now stands at around Rs 1 lakh per month. The area, popular for its barsatis or rooftop flats, has seen a dramatic shift as older buildings are replaced with newer constructions, leading to further price hikes. 

A barsati in Defence Colony now rents for Rs 30,000-Rs 40,000 per month, up from Rs 25,000 per month till three years ago. Aditya, a local broker, told Newslaundry that as older buildings are being replaced with newer constructions, landlords are opting for flats instead of barsatis, as they fetch higher rents. 

Several brokers also pointed out a stark difference in rent in South and North Delhi. Arjun claimed that the rent disparity between the two areas is “at least 20 percent”, with South Delhi being more expensive. He attributed this difference to the presence of government buildings, other complexes, and cleaner and more spacious localities in South Delhi. Sunil, a broker in Greater Kailash, said that higher rents in the south are also due to the prevalence of new buildings, gated communities, enhanced safety, and proximity to more upscale and luxury flats.

However, rent has surged in North Delhi too. Aditya, a broker in the area, told Newslaundry that rents in neighbourhoods such as Nehru Vihar have increased substantially, with rooms that could be rented for Rs 5,000 to 5,500 now costing between Rs 6,500 and 7,000 per month.

Pressure from Gurugram, co-living trend

For Ayushi, 25, a professional working in an influencer marketing firm in Gurugram, rising rent has meant a constant struggle to find a place within her budget. She now pays Rs 12,500 for an unfurnished one-bedroom flat in Chattarpur, up from Rs 10,500 when she moved in. “After new tenants moved in upstairs, my landlord increased the rent.” 

Like Ayushi, many are moving from Gurugram to Delhi due to the high rents and lack of amenities, contributing to the upward pressure on Delhi rents.

Ritika, an ad agency employee in Gurugram, shares a two-bedroom flat in Lajpat Nagar with a friend. They initially paid a rent of Rs 25,000 per month, but it has risen by Rs 5,000 in two years. “Finding affordable options is a struggle. Either rents are too high or the properties are in poor condition,” she said, adding that she would prefer a one-bedroom flat “if rent wasn’t such a problem”. 

Many young professionals and students are turning to co-living spaces as an affordable alternative. In Kamala Nagar, some students opt for four-sharing rooms, which cost around Rs 4,000 per person, significantly cheaper than renting a one-room flat, typically with no kitchen and shared washroom, for Rs 15,000 per month. 

Saif, 30, a PhD student at Jamia Millia Islamia, said that he shared a room with a friend in his previous flat in Jamia Nagar and paid Rs 4,000 as rent. But he has now opted for a single room in a two-bedroom flat because “since I am doing my PhD, I need my privacy”. 

The student said that he contacted over 40 brokers over two months and spent thousands of rupees to find an “affordable flat” in Jamia Nagar. He now pays over Rs 8,000 per month for his room in the two-bedroom flat, which he says he found out of “sheer luck” and “is definitely cheaper than the market price.” 

Delhi needs six lakh more houses; a global problem

Puri of ANAROCK Group said that while high rental values in the last few years, particularly in 2023, have affected the middle class and low-income renters in Delhi, rents have now stabilised. 

However, with the influx of over 20 lakh migrants in Delhi in recent years, the capital is estimated to require around six lakh new houses in accordance with the average household size of 3.4 people in the city, as per the Ministry of Statistics’ Periodic Labour Force Survey.

As per NoBroker, India’s average rental inflation is higher than that of 29 percent in Singapore and 20 percent in Dubai year-on-year. Meanwhile, some pockets in cities like Bengaluru have seen rent hikes of over 30 percent. 

Puri told Newslaundry that cities like Bengaluru have experienced rental increases even beyond pre-pandemic levels. In some areas like Sarjapur Road and Whitefield, rents have surged by 67 percent and 72 percent, respectively, compared to 2021.

In New York, known as one of the most expensive cities in the world, the average asking rent for publicly listed apartments reached a record high of $3,500 per month in 2023. But Professor Pati pointed out that political mobilisation around rising rents in such cities is also far stronger in contrast to the situation in India, where there is a lack of political discourse on the issue.

A common question that arises is whether buying a home is more financially prudent than renting. Professor Pati told Newslaundry that it also depends on individual preferences and aspirations rather than strictly on finances, as property prices have been rising alongside rental costs. 

Puri of ANAROCK said that the post-Covid world has seen a shift in the mindset of millennials, who once embraced the “on-the-go” mentality are now preferring to buy over spending on rent. He attributed this change not only to financial volatility during the pandemic but also to the sense of security from owning physical assets.

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