Homes Become More Affordable in Last 10 Years

Bangalore: Real estate prices are soaring high across all metro cities of the country, out of which, Mumbai real estate prices are probably at the highest rate. But according to an analysis of HDFC data, home price have become more affordable across the country, than they were a decade ago, reports Mayur Shetty of TNN.

The data shows that, HDFC borrowers have paid an average amount of 12 lakh for a house back in 2002, which has increased to 40 lakh by the year 2011. The data also revealed that in 2002, the average salary of borrowers was 2.45 lakh which rose upto 8.3 lakh in 2011. This clearly highlights that the affordability rate of home buyers have increased considerably over the past 10 years. In 2002, average home buyers needed 5.1 times of their annual salary which has now decreased to 4.8 times of the annual salary in 2011.

HDFC’s data implements to the country’s average affordability rate, the per capita income of the country has increased to 53331 in 2010-11 from 19, 040 which is three times more than the per capita income in 2002-03.

With the increase in affordability, housing and housing loans will continue to grow in next few years. According to Jones Lang Lasalle, considering the shortage of 26 million housing units in India, the trend in increase of housing loans and increase in affordability rate will last for some time.