Mumbai’s housing affordability has improved to its highest level in the past 15 years, as per a report by Knight Frank. But despite this, home ownership is still far from possible for most residents. Even high-income earners are finding it difficult to buy property in the city.
According to a report by the National Housing Bank, the top 5% of Mumbai’s urban households would have to save for 109 years to afford an average-priced home. This shows how serious the affordability crisis is in the city.
How Much Does an Average Mumbaikar Spend on Households?
A separate report by Knight Frank India shows that the average Mumbai household now spends 48% of its monthly income on home loan payments. This is a small drop from 50% last year.
Are Homes in Mumbai Affordable?
For the first time in the history of Knight Frank’s affordability index, Mumbai has fallen below the 50% mark. This mark is considered the outer limit for affordability. The report states that falling home loan interest rates helped improve the numbers. But experts say that the situation is still far from truly affordable.
What is Affordable Housing?
The government defines affordable housing as a home that costs less than INR 45 lakh. In metro areas, this home should have a carpet area of up to 60 square meters. In non-metro areas, the limit is 90 square metres. These guidelines were introduced in 2017.
However, real estate body CREDAI has asked for this INR 45 lakh cap to be raised. They want the limit increased to INR 75–80 lakh. They have also suggested a 1% GST on under-construction homes in this higher price range.
What Can You Get in Mumbai for an Affordable House?
In Mumbai, it is hard to find a home within the INR 45 lakh budget. Prices in the city range from INR 20,000 to INR 3 lakh per square foot. For many buyers, owning a house in Mumbai remains just a dream.
For around INR 50 lakh, a buyer can get a 1 BHK flat in areas like Mira Road, Vasai, Virar, Thane, Kalyan, Dombivli, and Panvel. These areas are part of the Mumbai Metropolitan Region but lie outside the city’s limits.
What is the Price Range of Households Sold in Mumbai?
Knight Frank’s analysis of Maharashtra’s property registration data shows that about 80% of homes sold in Mumbai each year are priced under INR 2 crore. In the first 11 months of 2023, 114,000 properties were registered in Mumbai. Of these, over 94,000 homes, or about 82%, were priced up to INR 2 crore. Over 12% were in the INR 2 crore to INR 5 crore range, and about 4% were priced above INR 5 crore.
In 2024, 1.28 lakh properties were registered in Mumbai. This is a 12% rise compared to the previous year. Of these, about 1.01 lakh, or 78%, were priced up to INR 2 crore. Over 15% fell in the INR 2 crore to INR 5 crore range. The remaining 5% were priced above INR 5 crore.