Mumbai’s High Rental Costs Strain Professionals’ Finances

Mumbai continues to hold the title of India’s most expensive city for rental housing, with the average rent for a 1 BHK apartment climbing to INR 5.18 lakh annually. According to a recent CREDAI-MCHI report, this figure far exceeds the average annual earnings of junior-level employees, who typically make around INR 4.49 lakh. This disparity has triggered concern across professional segments, where the escalating cost of living is becoming unsustainable, potentially driving talent to relocate to more affordable cities like Bengaluru or Delhi-NCR, where rental rates are nearly half that of Mumbai.

Comparatively, junior-level professionals in Bengaluru and Delhi-NCR not only pay lower rents—around INR 2.32 lakh and INR 2.29 lakh per year, respectively—but also enjoy a higher disposable income. In these cities, their average annual earnings reach INR 5.27 lakh in Bengaluru and INR 4.29 lakh in Delhi-NCR, allowing for a more comfortable standard of living. In Mumbai, however, high rent levels significantly erode disposable income, leaving professionals struggling to balance daily expenses and long-term savings, which could diminish the city’s appeal as a business hub.

Mid- and senior-level professionals are equally burdened by Mumbai’s steep rental prices. Mid-level professionals earning an average salary of INR 15.07 lakh annually are estimated to spend nearly half—around INR 7.5 lakh—on a 2 BHK apartment. This cost compares starkly with the INR 3.90 lakh and INR 3.55 lakh average rents for similar apartments in Bengaluru and Delhi-NCR. The lack of disposable income, coupled with long, taxing commutes, is encouraging professionals at all levels to consider relocating to cities with a better work-life balance and cost of living.

Beyond individual financial burdens, Mumbai’s housing crisis reflects broader systemic challenges. High approval costs for real estate projects, estimated to be up to 50 times higher than in cities like Hyderabad and Bengaluru, deter affordable housing projects and make it difficult for developers to meet the city’s soaring demand. While Mumbai has over 1,671 infrastructure projects underway, including the ambitious metro rail and Trans Harbour Sea Link, the city’s high cost of living risks underutilising these developments if professionals continue to migrate to more affordable cities. Without intervention, Mumbai may face an outflow of talent, leaving the city’s future growth hanging in the balance.

This exodus reflects a significant civic challenge, highlighting the need for policy reforms to make Mumbai a more sustainable city for residents across all income levels.