Ahmedabad most affordable housing market, Mumbai most expensive: Report

By: |
December 30, 2020 5:46 PM

City-wide average affordability statistics cannot highlight disparities in housing costs within sub-markets or across the income spectrum, it added.

Even for Mumbai, the affordability ratio has improved from a high of 93 per cent in 2010 to 61 per cent in 2020.Even for Mumbai, the affordability ratio has improved from a high of 93 per cent in 2010 to 61 per cent in 2020.

Ahmedabad has become the most affordable housing market in the country while Mumbai remains the costliest, according to property consultant Knight Frank India.

The consultant released its Affordability Index 2020, which showed that Ahmedabad was the most affordable housing market in India with an affordability ratio of 24 per cent, followed by Pune and Chennai at 26 per cent each in 2020.

A ratio over 50 per cent makes it difficult to secure home loans from banks and housing finance companies, making it unaffordable to purchase a house, Knight Frank India said.

The affordability index, which tracks the EMI (Equated Monthly Installment) to income ratio for an average household, has shown meaningful improvement in affordability over the last decade.

The consultant said that decline in housing prices and multi-decade low home loan interest rates have helped improve housing affordability in 2020.

“While Mumbai is the most expensive market, with affordability ratio of (61 per cent), other cities like Ahmedabad, Chennai and Pune are relatively more affordable,” Knight Frank said.

Even for Mumbai, the affordability ratio has improved from a high of 93 per cent in 2010 to 61 per cent in 2020.

The index captures movement in key constituents like property prices, home loan interest rate and household income that determine the buyer’s ability to purchase a house.

City-wide average affordability statistics cannot highlight disparities in housing costs within sub-markets or across the income spectrum, it added.

In NCR, the affordability ratio has improved to 38 per cent from 53 per cent in 2010, while in Bengaluru, the ratio has become better at 28 per cent from 48 per cent a decade ago.

As per the report, the ratio improved to 26 per cent in Pune and Chennai both from 39 per cent and 51 per cent in 2010.

In Hyderabad, the ratio has become better at 31 per cent from 47 per cent, while in Kolkata it improved to 30 per cent from 45 per cent.

The consultant said that affordability ratio improved in Ahmedabad to 24 per cent from 46 per cent.

Shishir Baijal, chairman and managing director, Knight Frank India said, “The affordability ratio across top eight cities has improved tremendously over this decade due to an increase in income level, lower interest rate and subsequently lower property prices.”

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1India’s consumer internet market saw ‘swoosh-shaped’ recovery in 2020; to hit $250B GMV in 2025
2NCLT admits Antrix Corporation’s winding up plea for Devas Multimedia, appoints liquidator
3CAIT to Piyush Goyal: Need immediate action on Amazon, Flipkart, others for violating ‘Country of Origin’