Want to Buy a House? Check 3 Most Affordable City in India

    According to the Home Purchase Affordability Index (HPAI) 2022 Survey from real estate firm JLL, Mumbai has grown marginally less economical, while Kolkata, Hyderabad, and Pune continue to be the most affordable city in India.

    According to JLL, affordability levels of house purchase are expected to decline gradually in 2022 and 2023 as rising prices and socioeconomic headwinds reduce household incomes and residential expenses grow as input costs have yet to be fully passed on to final pricing. Another element that will reduce affordability levels is the RBI’s increase in the repo rate, it was said.

    Methodology of the JLL HPAI

    The JLL Home Purchase Affordability Index indicates whether a household with an average annual salary is qualified for a mortgage on a home in the city at the going market rate. This housing affordability index was created using a mix of factors, such as the cost of the residential apartment, the average family income, and the interest rates on home loans. The capacity of a homeowner to finance a home purchase depends on the interaction between property value, employment, and loan growth rates. The lowest cost of living in India is also influenced by the city’s standard price per square foot and the typical apartment size.

    Through 2022’s conclusion and into 2023 after that, price levels are likely going to go lower. India’s cheapest city rates will probably increase and reach almost 8-year record levels.

    Most Affordable City in India in 2022

    With a value of 192, Kolkata is still on course to hold the title of the country’s cheapest places to live in India among the top seven cities, followed closely by Pune (183) and Hyderabad (174). According to the research, all three cities would likely experience best cities to buy property in India in 2022 and 2023.

    Mumbai improved the most quickly in terms of HPAI score, and when its threshold reached 100, it turned into a market that was accessible to all. Given the economic and financial headwinds, it is anticipated to fall slightly below the affordable market threshold value. However, it will still be well above its HPAI low of 43 in 2013, according to JLL.

    The JLL Home Purchase Affordability Index (HPAI) indicates how well a household with an average annual income qualifies for a mortgage on a home in the city at the going market rate. The best and cheapest place to live in India is a household with the proper income to be approved for a mortgage if the value is 100. If you fall below that threshold, your household will not have sufficient income to be approved for a mortgage.

    The survey also noted that Bengaluru (167) and Chennai (161) included the cheapest state in India to live in comparatively high affordability levels.

    Affordability that Still Manages to be Appealing

    According to JLL Research’s analysis, the ideal storm of decadal low mortgage rates, attractive pricing, and recovering household income occurred in 2021, when affordability peaked.

    The increase in home loan prices brought on by the RBI’s repo rate hikes and developers passing along rising input costs to consumers due to inflationary pressures have significantly tempered affordability gains in 2022.

    Household incomes are anticipated to increase by an average of 7% this year. According to the survey, residential prices of most affordable city in India have also increased, with price growth averaging 4–10% across the major cities due to strong demand and the transfer of higher input costs to purchasers.

    Also Read: An Ideal List of 5 Top Indian IT Companies in 2023

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    Josie Patra
    Josie Patra is a veteran writer with 21 years of experience. She comes with multiple degrees in literature, computer applications, multimedia design, and management. She delves into a plethora of niches and offers expert guidance on finances, stock market, budgeting, marketing strategies, and such other domains. Josie has also authored books on management, productivity, and digital marketing strategies.

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