Ahmedabad, Pune, Chennai most affordable housing markets of 2020: Report



The latest affordability index of India on Wednesday cited as the most market in the country with an affordability ratio of 24 per cent followed by and at 26 per cent each this year.


Knight Frank’s proprietary affordability index, which tracks the equated monthly installment (EMI) to income ratio for an average household, shows meaningful improvement in affordability over the last decade.



Even in the pandemic year of 2020, housing affordability further improved. The decline in house prices and multi-decade low home loan interest rates helped improve housing affordability in 2020.


While Mumbai is the most expensive market with affordability ratio of 61 per cent, other cities like Ahmedabad, and are relatively more affordable. 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.


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


Shishir Baijal, Chairman and Managing Director of 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.


“Government interventions around improved credit flow, lower interest rate and cut in stamp duty rate in some markets have brought confidence among homebuyers in 2020,” he said.


“We believe a combination of best in decade affordability level and pick-up in the economy will serve as key catalysts for the country’s housing market next year.”


.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor





Source link