Homes Become More Affordable in Last 10 Years

According to Deepak Mehta, a Mumbai-based real estate broker, "Around 2001-02, a one-bedroom apartment in Andheri costing Rs 22 lakh would fetch a rent of Rs 8,000 to Rs 9,000. Today, the market value of the same apartment is over Rs 1 crore, but the rental income is at best Rs 25,000. Rentals have not kept pace with house prices," reports TOI.

Surprisingly, the year 2004 was an ideal year to buy property because during this time borrowers got tax benefits on larger loans and interest rates also started falling.

Mehta further said that "Monthly rentals in Mumbai are in the range of 22 to 25 basis points of the property value." Real estate developers believe that in Mumbai, the reason behind the high prices is because of limited supply. Supporting the above statement, Vyomesh Shah, MD, Hubtown said that “Today, even in a city like Ahmedabad, there are projects where you can get apartments where the rate per square foot is around Rs 2,500."