A family in Mumbai spends over half of its monthly income in paying equated monthly instalments (EMIs) of home loans, according to a report by Knight Frank India. The report said Mumbai’s Affordability Index in 2023 is at 51 per cent, which is above the affordability threshold.
According to the report, the Affordability Index makes Mumbai the most expensive residential market in the country. Last year, the Index stood at 52 per cent, which reached as high as 67 per cent. “This is a significant improvement of 16 per cent in the affordability levels since 2019,” the Knight Frank report said.
“Mumbai is the only city beyond the affordability threshold of 50 per cent, a level exceeding which banks rarely underwrite a mortgage,” the report said.
According to the report, Ahmedabad is the most affordable housing market in the country with a 21 per cent affordability ratio, which means a family in the city spends 21 per cent of their monthly income towards home loan EMIs.
Ahmedabad was followed by Kolkata and Pune with the affordable ratio at 24 per cent each in 2023.
Among the most expensive cities, Hyderabad is the second-most expensive residential market after Mumbai. NCR’s affordability index stands at 27 per cent. Bengaluru is the fourth most expensive city with a 26 per cent affordability ratio.
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