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YUGEN REALTY, SURAT
In Ahmedabad, homebuyers spend around 21% of their monthly income on EMI, while in Mumbai, this figure rises to a significant 51%.
This disparity makes Mumbai’s property market one of the least affordable among the top 8 real estate markets in the country, while Ahmedabad’s market remains relatively affordable.
According to the Affordability Index, the stability in interest rates since the end of 2023 has led to an improvement in home-buying capacity in the first half of 2024.
The trend of stable interest rates was maintained by the RBI in August as well. Kolkata ranks second, where people spend about 24% of their income on EMI.
Pune residents also allocate about 24% of their income towards EMI payments.
Improvement in Affordability Index for Top 8 Cities from 2010 to 2021
Between 2010 and 2021, there has been a continuous improvement in the Affordability Index across the top eight cities.
The pandemic-induced significant reduction in the repo rate led to an ideal income-to-EMI ratio. However, with rising inflation, the RBI raised the repo rate by 4% to 6.50% between May 2022 and the following year, leading to increased costs in comparison to EMI. Despite this, the repo rate has remained stable since February 2023.
Home Sales in the Country’s Top Seven Major Cities Expected to Rise by 12%
In the top seven cities of the country, home sales are expected to grow in double digits during the fiscal year 2024-25.
The Mumbai Metropolitan Region, Delhi NCR, Bengaluru, Hyderabad, Pune, Kolkata, and Chennai are projected to see a 10% to 12% annual increase in sales area, potentially reaching 750 to 800 million square feet, according to estimates by the rating agency ICRA.
Despite moderation in the sales growth rate, overall sales momentum, inventory, and inventory status are expected to remain healthy in 2024-25. Inventory reduced from 732 million square feet in March 2023 to 687 million square feet by June. Meanwhile, residential sales saw a 19% increase in 2024.
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Disclaimer : This information has been collected through secondary research and Yugen Realty Newspaper is not responsible for any errors in the same.
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