Delhi’s south-western suburbs Mehrauli and Vasant Kunj both draw interest from investors seeking steady rental returns. On paper, their average yields range similarly—from about 2.5% up to 4% per annum—but when you peel back the layers, distinct factors drive stronger performance in one area over the other. Mehrauli benefits from heritage charm, more affordable equities, and growing retail hubs around Chattarpur and Qutub, whereas Vasant Kunj commands premium rents tied to nearby offices, top schools, and high-end malls like DLF Avenue. In this post, we’ll walk through:
- What “rental yield” really means
- Key stats for Mehrauli’s market today
- Vasant Kunj’s rent-to-price ratios
- A side-by-side comparison table
- What drives higher (or lower) yields in each locality
- Actionable tips for boosting returns
By the end, you’ll know which suburb better matches your budget, risk appetite, and timeframe—backed by real numbers and on-the-ground insights.
What Is Rental Yield and Why It Matters
Rental yield measures how much income a property generates relative to its value. Technically, it’s calculated as (annual rent ÷ purchase price) × 100%. A higher yield indicates more rental income per rupee invested.
- Gross yield uses rent before expenses.
- Net yield nets out maintenance, taxes, and vacancies.
Yield helps investors compare disparate markets (e.g., a ₹50 lakh flat in Mehrauli vs. a ₹1 crore apartment in Vasant Kunj) on equal footing—and spot where their money will work hardest.
Mehrauli at a Glance
Mehrauli—one of Delhi’s five historic cities—offers a mix of gated complexes, builder floors, and independent bungalows. Its average apartment price sits around ₹4,417 per sq ft, with entry-level projects starting near ₹3,600 per sq ft. Monthly rents for a 2 BHK usually range from ₹20,000 to ₹35,000, depending on age and furnishing level.
- Average price: ₹3,600–4,938 per sq ft
- Typical 2 BHK rent: ₹20,000–₹35,000
- Estimated gross yield: 2.5%–4%
Why Mehrauli’s Yields Hover at 2.5%–4%
- Affordable purchase cost. Lower per-sqft rates mean even modest rent generates a decent percentage return.
- Emerging retail and leisure hubs. Chattarpur market, Aga Khan Road cafés, and Qutub Metro spur steady rental demand from youngsters and families.
- Heritage tourism. Short-term stays (Airbnb/hostels) around forts and tombs occasionally push yields higher.
However, Mehrauli also faces:
- Older stock. Many builder floors date to the 1990s—higher upkeep drags down net yields.
- Infrastructure gaps. Traffic bottlenecks on Mehrauli–Chattarpur Road can deter higher rents.
Vasant Kunj in Focus
Vasant Kunj, just north of Gurgaon, is a planned colony with premium condos, sprawling DDA pockets, and high-rise gated communities. Prices average ₹15,390–18,800 per sq ft in 2025—up 22% year-on-year—while a furnished 3 BHK rents for ₹45,000–70,000 per month.
- Average price: ₹4,444–25,000 per sq ft (affordable to luxe)
- Typical 3 BHK rent: ₹40,000–₹70,000
- Gross yield band: 2.5%–4%
Why Vasant Kunj Hits Similar Yields on Higher Rents
- Premium pricing. High purchase cost caps yield %, even if absolute rent is attractive.
- Corporate proximity. Aerocity, Cyber Hub, and nearby office parks attract expat and corporate tenants at solid rents.
- Lifestyle amenities. DLF Promenade, malls, top schools (GD Goenka, IK Gujral) command a rent premium.
Challenges include:
- Steep entry barrier. Yields can slip below 3% for ₹20,000–₹25,000 per sq ft luxury flats.
- Supply glut. New condo launches sometimes drive rents down as developers offer freebies.
Side-by-Side Yield Comparison
Factors Driving Yield Differences
1. Purchase Price vs. Rent Ratio
- Mehrauli’s lower base price boosts percentage yield even on modest rents.
- Vasant Kunj’s premium rate pushes absolute rents up but proportionally reduces yield.
2. Tenant Profile & Vacancy Risk
- Mehrauli tenants often include students and small families—shorter leases and slightly higher vacancy.
- Vasant Kunj attracts professionals on annual contracts—longer tenures and fewer vacancies.
3. Maintenance & Amenities
- Newer gated complexes in Vasant Kunj have higher maintenance fees, trimming net yield.
- Mehrauli’s older buildings may have lower monthly charges but occasional repair costs.
4. Infrastructure & Connectivity
- Proximity to the Airport Metro (Harkesh Nagar), Golf Link, and Delhi–Gurgaon Expressway favors Vasant Kunj rents.
- Mehrauli’s single arterial road can bottleneck but upcoming flyovers promise relief.
How to Maximize Your Rental Yield
- Target older mid-range stock in Mehrauli. Look for 10–15-year-old builder floors with solid floor plans—these often sit at ₹3,600–4,000 per sq ft and command ₹20,000–₹25,000 rent for a 2 BHK.
- Opt for furnished turnkey apartments in Vasant Kunj. A furnished 2 BHK in DDA Pocket C can fetch ₹45,000 to ₹50,000, boosting yield by 0.5–1%.
- Negotiate longer lease terms. Securing 2–3 year contracts reduces vacancy risk and negotiation on rent resets.
- Add value through minor upgrades. In Mehrauli, a fresh coat of paint and modern light fixtures can justify a 5–7% rent hike. In Vasant Kunj, adding built-in wardrobes or smart locks can boost appeal.
- Leverage short-term rentals near heritage sites. Convert one room into an Airbnb in Mehrauli’s Old Town cluster for 8–10% returns during tourist season.
Which Suburb Suits You?
- Choose Mehrauli if you:
- Have ₹40–50 lakhs to spend and want 3–4% yields.
- Are comfortable with periodic upkeep on older stock.
- Wish to tap seasonal short-term demand near Qutub Minar.
- Have ₹40–50 lakhs to spend and want 3–4% yields.
- Choose Vasant Kunj if you:
- Can invest ₹1 crore+ and need stable 2.5–3% yields.
- Want minimal vacancy and premium tenant profiles.
- Value high-end schools, malls, and corporate proximity.
- Can invest ₹1 crore+ and need stable 2.5–3% yields.
Conclusion
Both Mehrauli and Vasant Kunj deliver respectable rental yields in today’s Delhi market—typically trading between 2.5% and 4%. Your choice boils down to entry cost versus tenant quality. Mehrauli’s affordability and tourism-driven short-term demand can edge yields higher, while Vasant Kunj’s premium ecosystem offers steadier, lower-risk income. By understanding local rent-to-price ratios, tenant preferences, and infrastructure plans, you can position your investment to maximize returns—whether on a tighter budget in Mehrauli or a luxury-focused play in Vasant Kunj.
Ready to explore listings or get personalized yield projections? Reach out to Fulin Space for expert guidance tailored to Delhi’s dynamic neighbourhoods.
