India's Home Affordability Remains Steady in H1 2024, Says Report
The COVID-19 pandemic has had a lasting impact on India's residential real estate market, leading to improved affordability and sustained demand for homes.
Home AffordabilityResidential Real EstateKnight Frank IndiaAffordability IndexEmi To Income RatioReal Estate MumbaiAug 07, 2024
The pandemic led to a recalibration of both property prices and lending rates, significantly boosting demand in the residential real estate market. This momentum has persisted, supported by strong economic factors such as effective inflation control and economic growth, which has improved home affordability.
As per the report, Ahmedabad is the most affordable housing market among the top eight cities, with a ratio of 21%, followed by Pune and Kolkata at 24% each. Mumbai was the only city that remained marginally higher than the threshold at 51%.
The report also notes that the stable interest rate scenario is expected to sustain in the near term, as economic growth continues to remain on track. Demand has continued to grow since 2023 and has sustained at multi-year highs in H1 2024.
The report highlights that all markets have shown improved affordability, leading to sustained demand for homes. In Mumbai, for instance, the affordability index improved by 16 percentage points, moving from 67% in 2019 to 51% in H1 2024.
City-wise weighted average prices have also grown across all markets, with Bangalore growing at 9% YoY and Mumbai, NCR, and Pune growing at 4% YoY each in H1 2024.
Frequently Asked Questions
What is the current state of home affordability in India?
Home affordability in India has remained stable in the first half of 2024, with the Affordability Index showing a steady improvement from 2010 to 2021.
Which city is the most affordable housing market among the top eight cities?
Ahmedabad is the most affordable housing market among the top eight cities, with a ratio of 21%.
What is the expected interest rate scenario in the near term?
The stable interest rate scenario is expected to sustain in the near term, as economic growth continues to remain on track.
How have city-wise weighted average prices grown across all markets?
City-wise weighted average prices have grown across all markets, with Bangalore growing at 9% YoY and Mumbai, NCR, and Pune growing at 4% YoY each in H1 2024.
What is the impact of the COVID-19 pandemic on India's residential real estate market?
The pandemic has had a lasting impact on India's residential real estate market, leading to improved affordability and sustained demand for homes.
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