Mumbai, known for its bustling streets, diverse culture, and economic vibrancy, has earned a distinction as the most expensive city to live in, as per the recently released Knight Frank Affordability Index for 2023.Ahemdabad is ranked as India’s most affordable city to live in.
The issue of housing affordability has taken centrestage as cities strike a balance between economic growth and the well-being of their inhabitants. The demand for a skilled workforce to power economic engines often clashes with the inadequate supply of quality housing, leading to a surge in property prices that far outpaces income growth.
The government’s focus on affordable housing, exemplified by the flagship ‘Housing for All by 2022’ programme, has played a pivotal role in reducing residential unit prices and increasing affordability.To better comprehend the global affordability crisis, Knight Frank has pioneered the Global Affordability Monitor, evaluating 32 cities worldwide based on three critical parameters.
Mumbai finds itself positioned in the second-most affordable bracket among these cities, which ironically places it as the least affordable city in India.The Knight Frank India Affordability Benchmark further corroborates Mumbai’s dire situation. With average house prices standing at around seven times the average household income, the financial burden of homeownership in Mumbai is the heaviest across all major Indian cities.India, boasting one of the world’s fastest-growing economies, has witnessed remarkable urban expansion driven by employment and business prospects.This growth has attracted a wave of individuals seeking upward mobility and a better quality of life. Acquiring a home symbolises stability, achievement and social status, making residential real estate a prized possession.This fervour for property ownership has driven prices skyward. However, in the early 2010s, the market dynamics shifted. Spiralling prices coupled with larger apartment sizes, led to demand contraction, leaving developers with unsold inventory.Other cities such as Kolkata, Ahmedabad and Pune stand out as exemplars of improved affordability, with apartment prices at just three times the average household income.The Knight Frank Affordability Benchmark, set at 4.5 times the average annual household income, remains a goal for cities like Mumbai, NCR and Hyderabad.
