In recent years, renting and leasing costs have been steadily rising in metro cities across the
globe. From New York to Mumbai, London to Sydney, the story is similar: more people are
struggling to afford housing and commercial space in big cities. For the average person,
especially middle- and lower-income earners, these rising costs have started to influence
everything—from how and where they live, to how they plan their careers and personal lives.
While renting is often seen as a flexible and convenient alternative to buying property, the
current trends are placing pressure on urban residents. At the same time, there are some
advantages and economic factors driving this shift. Let’s take a closer look at the good and bad
of this growing urban reality.
The Rise in Rent: What’s Happening?
In 2024 and 2025, most metro cities have seen rental rates increase sharply. According to data
from real estate platforms like Zillow (US), 99acres (India), and Rightmove (UK), average rents
in major metros have risen between 10% and 25% in just the last two years.
This is due to a mix of factors:
● Increased demand post-COVID as people return to cities
● Limited new housing supply
● Inflation driving up construction and maintenance costs
● Migration of professionals and students into urban centers
● Short-term rental platforms like Airbnb reducing long-term rental stock
As a result, housing affordability is reaching crisis levels for many city residents.
The Downsides for Common People
1. Reduced Disposable Income: Rising rents mean people spend a larger portion of their
income on housing. In cities like Mumbai, New York, or London, rent can easily consume
40–60% of a household’s monthly income. This leaves less for food, savings, education,
healthcare, and emergencies.
2. Longer Commutes: High rents in central areas force people to move to city outskirts where
housing is cheaper. This leads to longer commutes, increased transport costs, and lost time. It
also adds to urban traffic congestion and pollution.
3. Housing Insecurity and Frequent Relocation: As leases end and landlords raise rents,
many renters are forced to move frequently. This causes instability for families, especially those
with children in school. Some tenants also face eviction or legal disputes when they cannot
keep up with rent hikes.
4. Shared Living & Smaller Spaces: To manage high costs, more people are turning to shared
accommodations or accepting smaller, less comfortable homes. In some cases, families live in
overcrowded flats, which impacts mental health, privacy, and quality of life.
5. Impact on Mental Health: Constant financial pressure, fear of eviction, and poor living
conditions contribute to rising mental health issues in cities. A stable and affordable home is
central to a person’s well-being, and when that's missing, stress levels increase.
The Upsides: What’s Driving the Rental Shift
Despite the challenges, there are some positive aspects of a rental-driven lifestyle in metros:
1. Flexibility and Mobility: Renting allows people to move easily between jobs, cities, or
countries. In a fast-changing job market, many young professionals prefer not being tied down
to property ownership. Leasing gives them flexibility to adapt to new opportunities.
2. No Long-Term Debt: Buying property in metro cities often requires huge loans, long EMIs,
and upfront payments. Renting avoids this financial burden. People can avoid getting trapped in
20–30 years of mortgage payments, which may not suit everyone’s financial goals.
3. Access to Better Localities: Renting can offer access to prime locations that would
otherwise be unaffordable to purchase. For example, living in central London or Bandra in
Mumbai might be impossible to buy into, but renting there could be achievable for some.
4. Low Maintenance Responsibility: Renters generally aren’t responsible for major repairs or
property taxes. That burden lies with the landlord. For people with limited time or funds, this is a
major advantage.
5. Boost to the Sharing Economy: The rise in renting aligns with the growing trend of the
"asset-light lifestyle"—where people rent not just homes, but furniture, vehicles, even
appliances. This supports startups and businesses focused on leasing services and encourages
sustainable consumption.
Impact on the Larger Economy
The rental market also influences broader economic trends:
Pros:
● Stimulates real estate sector: High demand for rentals encourages construction and
urban development.
● Supports job mobility: A strong rental market allows companies to hire from a wider
talent pool.
● Boosts consumer services: Areas with renters see more demand for food delivery,
furniture leasing, co-living spaces, and maintenance services.
Cons:
● Widening wealth gap: Renters don’t build equity, while property owners see their
assets grow. This worsens wealth inequality.
● Inflated property markets: Investors buying properties to rent out can drive up real
estate prices, making ownership even harder for first-time buyers.
● Gentrification: As wealthier renters move into working-class neighborhoods, long-term
residents can be priced out.
What’s Happening in Specific Metro Cities?
Mumbai, India: Rents in areas like Bandra, Lower Parel, and Powai have risen by over 20% in
the last year. Families are moving to Navi Mumbai and Thane for affordability, despite long
commutes.
New York City, USA: Median rent in Manhattan crossed $4,000/month in 2024. Rent control
laws help some tenants, but many face regular increases and limited options.
London, UK: With demand outpacing supply, average London rent has surged by 18% year-
over-year. Even outer zones like Zone 4 are now becoming expensive.
Sydney, Australia: A housing supply shortage has led to one of the fastest rent increases in
Australia’s history. Students and low-income workers are struggling the most.
Possible Solutions
To ease the pressure on renters, cities and governments are trying different strategies:
● Affordable Housing Projects: Governments can partner with private developers to
build low-rent housing for middle and lower-income groups.
● Rent Control Laws: Policies that cap annual rent increases can provide more stability.
● Vacancy Taxes: Some cities are taxing empty investment properties to encourage
rentals and reduce speculation.
● Urban Decentralization: Developing smaller cities and suburbs with good infrastructure
can reduce the burden on metro cities.
● Incentivizing Co-Living Models: Shared housing models with shared amenities can
offer quality living at lower costs.
Final Thoughts
The rise in renting and leasing costs in metro cities is a double-edged sword. For many common
people, especially young professionals and working families, renting offers flexibility, but also
brings instability and financial stress. The balance between affordability and access to
opportunity is becoming harder to maintain.
Governments, city planners, and real estate stakeholders need to act quickly to ensure cities
remain livable—not just for the wealthy, but for everyone. As urban populations grow, the future
of city life will depend heavily on how we manage housing—making it not just a product, but a
human right.
