Are you looking to buy a house? Ahmedabad, Pune and Chennai are the most affordable to own a property

NEW DELHI’s real estate market in India is at its best ten-year level in terms of housing affordability. Ratio of 50%, real estate advisor Knight Frank said in his “Accessibility Index 2021”.
Ahmedabad has become the most affordable housing market in the country with an affordability rate of 20%, followed by Pune and Chennai at 24% and 25% respectively, in 2021.
Mumbai was the only one to record an accessibility rate above the threshold at 53%, however, it improved the most since 2011. The accessibility rate in Bengaluru fell from 57% in 2012 to 26% in 2021 while the ratio in the NCR improved from 38% in 2020 to 28% in 2021

The affordability index captures changes in house prices, mortgage interest rates, and average household income to determine the ability of buyers to buy a home in a given city. Since banks take out home loans when the IME-to-income ratio is below 50%, existing income and average note size measurements in seven of the eight markets make it easy for a buyer to finance their home purchase. .
“For most of the past 5-6 years residential prices have been corrected leading to better affordability, however the recent reduction in the mortgage interest rate to below 6.5% has been a deciding factor. in Significantly Improving Housing Accessibility Over the Last 24 Months There is no doubt that it took a pandemic for the market to turn around and strengthen homebuyer sentiment, which is now evident in across the country, ”said Shishir Baijal, President and CEO of Knight Frank India.
It is therefore the ideal time for potential buyers to buy a home, given that all factors, in terms of the regulatory environment, price as well as mortgage rates are favorable.
Point to note: The Knight Frank Accessibility Index indicates the proportion of income a household needs to finance the monthly payment (MIE) of a dwelling in a given city. Thus, a Knight Frank Accessibility Index level of 40% for a city implies that, on average, households in that city have to spend 40% of their income to finance the EMI of the home loan for that unit. An EMI / Income ratio above 50% is considered unaffordable because it is the limit beyond which banks rarely take out a mortgage.