Home buying affordability levels in Indian markets have declined in 2022 compared to 2021, notes Knight Frank India, a real estate consultancy firm in its annual proprietary study of Affordability Index 2022.
The study noted that the 225 BPS cumulative increase in repo rate in 2022 and the consequent increase in home-loan rates, along with increase in residential prices caused the decline in affordability. However, while affordability levels in 2022 have worsened compared to 2021, they remain significantly better the pre-pandemic levels in 2019, said the study.
All markets, except Mumbai, are recorded to be well below the threshold of comfortable affordability set at 50% ratio. Ahmedabad emerged the most affordable housing market in the country with an affordability ratio of 22% followed by Kolkata and Pune at 25% each in 2022, said the study.