Can anyone afford Mumbai anymore? Rent eats salaries as professionals head for exit, claims report

Renting a 1 BHK in Mumbai costs an average of ₹5.18 lakh per year, outpacing the average annual salary of junior-level employees, which stands at ₹4.49 lakh. 

A new report from CREDAI-MCHI warns that this staggering disparity is pushing professionals out of the city, with many eyeing more affordable options in Bengaluru and Delhi-NCR, where similar flats cost nearly half as much at ₹2.32 lakh and ₹2.29 lakh, respectively. 

This growing divide between rent and income is fueling concerns of a looming ‘brain drain’ as workers seek better financial stability elsewhere.

For mid-level professionals in Mumbai, the picture is similarly grim. Those earning an average of ₹15.07 lakh per year spend nearly half of their income—₹7.5 lakh—on rent for a 2 BHK apartment. By comparison, their counterparts in Bengaluru and Delhi-NCR spend far less, around ₹3.90 lakh and ₹3.55 lakh, while earning comparable salaries.

Senior professionals aren’t spared either. In Mumbai, they earn an average of ₹33.95 lakh annually but spend a steep ₹14.05 lakh on rent for a 3 BHK, more than double what their peers pay in Bengaluru and Delhi, where the cost of similar accommodations is ₹6.25 lakh and ₹5.78 lakh, respectively. The report suggests that many senior employees are relocating to these cities, seeking a better quality of life and more disposable income.

This shift could have broader repercussions. Businesses in Mumbai are finding it harder to attract and retain talent, with high rental costs impacting the city's competitiveness. CREDAI-MCHI’s report warns that the continued exodus of skilled professionals could lead to a talent drain that hampers growth across industries.

High real estate premiums are also part of the problem. Developers face immense pressure, as Mumbai’s premium rates are far higher than in other major cities. According to the report, the approval costs for a developer in Mumbai are 25 times higher than in Delhi-NCR and 47 times higher than in Bengaluru, driving up housing prices and making affordable projects increasingly unviable.

A top developer, Niranjan Hiranandani, expressed concerns, stating that in Mumbai, "half of the cost of buying a house goes directly to the government in the form of taxes, making affordable housing virtually unachievable."  

This financial burden is driving both residents and businesses to seek more affordable opportunities outside the city, which could result in underutilization of some of Mumbai’s major infrastructure projects.

The report concludes that unless costs are reined in, Mumbai’s exorbitant rental market may continue to drive professionals—and the businesses that depend on them—away from the city in search of more affordable alternatives.