Following the report by ECA International about Singapore dropping down the rankings of cities with most expensive accommodation in Asia; wherein Mumbai continues to climb up the rankings.
Connected to India got in touch with ECA Regional Director, Asia, Lee Quane, for the reasons behind the rankings. “Mumbai is host to the most expensive average rents for expatriates in India. As the financial and commercial capital of India, assignment budgets in Mumbai tend to be higher, on average, than in other cities in the country. The popularity of Mumbai, and the population density within Mumbai city mean that there is a great deal of competition for apartments in desirable areas of the city. Indeed, most expatriates in Mumbai prefer to live in a relatively small number of neighbourhoods, considering the population of the city,” he said.
“These factors combine to make Mumbai the most expensive city for rentals in India, and the fifth most expensive city in Asia. Because Mumbai is the financial capital of India, demand remains strong for rented accommodation from year to year, fuelling annual rent increases of 5-9 per cent every year since 2015,” Quane added.
Most major cities in India have seen increases in average rent levels for expatriates over the last two to three years (with the exception of Kolkata, where rent levels have remained largely stable). As the level of foreign investment and business activity continues to grow, so does demand for quality accommodation from expatriates posted on assignment in major cities in the country. Rent increases over the last few years have been most pronounced in Mumbai, where the high population density and the strong local economy keeps demand high.
“In major Indian cities and South-East Asia, expatriates typically gravitate to centrally located neighbourhoods that contain high-end apartment developments. The central location helps mitigate against problems with traffic congestion that most Indian and South East Asian cities suffer from at peak times of day, with the exception of Singapore. Apartment complexes contain the requisite level of security expected by those moving to a new country, and property standards are ever-increasing. Outside of the most central areas, many expatriates on assignment with their family opt to live in gated communities where security meets with their expectations, and children can enjoy a more relaxed pace of life with more green spaces,” quoted Quane.
While illustrating the state of employee mobility in India and in South East Asia, Quane said, “Employee mobility into these regions continues to rise. This is reflective of an increase in the number of companies headquartered in locations such as China, Korea Republic and Taiwan expanding operations into these regions and sending staff from their headquarters to coordinate expansion in these locations. Also, companies from traditional sources of expatriates, such as Europe and North America, are also sending more staff at increasingly wider ranges of seniority. These two combinations of factors contribute to a larger expatriate population in India and South-East Asia in recent years.”
ECA International is a software and human resources management provider based in UK, in a report. To assist companies in formulating their accommodation policy and deciding what level of housing allowance to provide to international employees, ECA International publishes annual Accommodation Reports. These reports contain information on the types of accommodation and geographical areas usually favoured by international assignees – typically areas near to international schools, business districts or social focal points.