As in the case of other metropolitan areas the percentage of households living in rental housing in Delhi has been declining. From a high of 69.6 percent in 1961 the proportion came down to 49 percent in 1989. The status of households in urban Delhi as a whole and separately for the area of Municipal Corporation Delhi (MCD), New Delhi Municipal Committee (NDMC) and Delhi cantonment for the period 1961-81 has shown great changes. In sharp contrast due to the continuing appreciation in the value of properties in Kerala, rental housing in showing an increasing trend.
Apart from NDMC area, the number of households living in rented houses has showed a decline in all the other areas. In 1981, 93.74 percent of the households in the NDMC area lived in rented houses. The proportion at 87.21 percent – was quite high in Delhi Cantonment also. The high proportion of rental housing in these areas is accounted for by the large presence of staff housing provided by various government agencies in these areas. The lowest renting is in the MCD area. The housing market in this area is predominated by private sector.
The decline in proportion of households living in rental housing is also the highest in MCD area. The housing market in this area is predominated by private sector. The decline in proportion of households living in rental housing is also the highest in MCD as compared to that in NDMC and Cantonment area. Despite the decline in percentage terms, the number of households living in rental houses in urban areas, in absolute terms has increased in all the three areas.
In urban Delhi as a whole, the number of households living in rental housing has shown a continuous increase over this period. During the period 1961 - 81, the number of households living in rented houses grew at a rate of 1.96 percent per annum. The rate of growth of ownership housing in Delhi and by implication the relatively declining size of Rental Housing Market (RHM) can be explained in terms of household characteristics and various market and institutional variables. Whereas household characteristics operate through the demand side, the market and institutional variables influence both demand for and supply of rental housing.