Affordable homes attracts higher the rental yields

Rental solutions have been key to addressing India’s housing challenges, and the country’s rental real estate holds immense potential. In 2017, the rental real estate market was pegged at one crore units and was valued at $22 billion (Rs 1.53 lakh crore). By 2023, its volume is expected to be 1.8 crore and valuation $41 billion (Rs 2.85 lakh crore). However, maximising rental yields has been a challenge for the rental real estate market. Low rental yield and poor capital appreciation, especially in the past two-three years, have hurt investors. However, smart choice of investments, value-added services and a host of online rental disrupters can be a game-changing recipe for India’s rental real estate market and investors. Magicbricks data suggests that yields in the affordable homes segment are higher compared to the mid-level or luxury segment. There is also a significant variation between yields based on their capital values(Rs/sq. ft).