In home sales, prices are moved up because of an increase in demand that results in multiple offers and a bidding situations. Since apartments aren’t typically bid on, how do the prices move upward? Are different metrics such as vacancy and inventory measured and then coincidentally an arbitrary, new rent price is set?
Rent prices also get increased/increased just like them in case of the home sales.
For example, If a flat owner finds a tenant who is willing to pay 16k, and in no time if suddenly some other guy came and asked the same flat for 17k or 18k, higher price than the first one, then the owner will be obviously interested giving his flat for the one who is paying higher. And since then, The owner starts increasing his base rent price. And creates an illusion that, the rent should be in that range for the other owners, so that other owners also starts increasing their base prices.
It usually depends on where it is located. If the area is starting be a more developed location, more structure are built like condos, offices then most probably the price of the rent increases.