Srinagar, Aug 18: Mumbai, Delhi and Hyderabad are the most expensive cities to live in India, according to the Knight Frank India Affordability Index 2023, released this week.
According to the Index, Srinagar is the 6th most affordable city in the country, with an EMI to income ratio of 32%. This means that an average household in Srinagar would need to spend 32% of their income to repay the EMI on a home loan.
It is pertinent to note that Knight Frank India Affordability Index is just one measure of the affordability of housing in India. Other factors, such as the availability of housing, the cost of living, and the quality of life are not considered in the ranking analysis.
Jammu is not included in the Knight Frank India Affordability Index 2023. The index only covers the top 17 cities in India.
Which are the top 5 most affordable cities?
Ahmedabad (with 23% EMI to income ratio) is rated as the most affordable city, followed by Pune (26%), Kolkata (26%), Bengaluru (28%) and Chennai (28%)
Least affordable cities
As per the index, the least affordable city is Mumbai, with an EMI to income ratio of 55%.
The other top two most expensive cities in the Knight Frank India Affordability Index 2023 are – Delhi-NCR (30%) and Hyderabad (31%).
These cities are the most expensive because they have a high demand for housing, but a limited supply. This is due to a number of factors, including the large population, the growth of the economy, and the increasing number of businesses setting up in these cities, according to the report analysed by Ziraat Times.
The high cost of housing in these cities makes it difficult for many people to afford to buy a home. This has lead to problems such as homelessness and overcrowding, the report suggests.
The other cities in the top 10 most expensive cities in the index are – Bengaluru (28%), Chennai (28%), Lucknow (33%), Jaipur (34%), Chandigarh (35%), Kochi (36%) and Coimbatore (37%).
How is the affordability index calculated?
The affordability index is calculated by dividing the average property price by the average annual household income. The higher the ratio, the less affordable the city is.
The affordability of housing in India has been declining in recent years due to rising property prices and interest rates. However, the Knight Frank report found that the decline in affordability has slowed in 2023. This is due to a number of factors, including the government’s measures to boost the economy and the continued growth of the real estate sector.
The report also found that the affordability of housing is expected to improve in the coming years, as property prices stabilize and interest rates remain low. However, the report warned that the affordability of housing in India will still be a challenge for many households.
