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India's Housing Dream: 12 Years' Income for a 3BHK
22 Jan
Summary
- A new 3BHK in India's top metros costs Rs 2.7 crore.
- Buyers need 12 years of average income to afford a 3BHK.
- 89% of new housing supply is in high-stress affordability segments.
The average price for a new 3BHK in India's leading metropolitan areas has reached Rs 2.7 crore. With an average annual income of Rs 23 lakh, prospective buyers would require approximately 12 years to afford such a property. This affordability challenge is compounded by increasing demand for larger, amenity-rich homes driven by evolving family structures and remote work trends.
However, escalating residential prices, rising land and construction expenses, and a concentration of premium supply have made these homes inaccessible. Analysis reveals that 89% of new housing supply is in markets where buyers experience considerable EMI stress, with 41% of this supply in 'income-stretch' zones.
Location choices can significantly impact savings, with central and premium areas functioning as wealth markets, while peripheral corridors offer more attainable ownership. Developer profit margins are notably higher in these high-stress zones, ranging from 45-50%, compared to 15-18% in affordable segments.
This trend of premium supply aligns with a post-pandemic shift towards larger homes and an increase in high-net-worth individuals, further intensifying affordability pressures for 3BHK properties.
