Rising property prices in Delhi-NCR are straining housing affordability, while Mumbai has recorded a notable improvement, according to the latest Knight Frank Affordability Index. Despite lower home loan interest rates, households in the national capital region are finding it increasingly difficult to manage monthly instalments for residential units, reflecting a divergence in urban housing dynamics across India’s largest metropolitan areas.
The Knight Frank Affordability Index measures the proportion of household income required to meet monthly EMI obligations on a housing unit. An index above 50 per cent signals that a property is generally unaffordable for an average household, while lower values indicate relative financial accessibility. In Mumbai, the EMI-to-income ratio has declined to 47 per cent in 2025, bringing it comfortably below the critical 50 per cent threshold and signalling improved affordability. By contrast, Delhi-NCR has seen a modest deterioration, with the affordability index increasing from 27 per cent last year to 28 per cent. This trend is largely attributed to a surge in weighted average property prices, particularly in the premium segment, which has amplified financial pressure on prospective buyers. “Affordability challenges in Delhi-NCR are primarily concentrated in high-end developments, while mid-market options remain more accessible,” an industry expert noted.
Other top-tier cities demonstrate a varied landscape of housing affordability. Ahmedabad ranks as the most accessible market, with an average EMI burden of just 18 per cent of household income. Pune and Kolkata follow at 22 per cent, highlighting the presence of affordable housing options outside the two major economic hubs. Analysts attribute this variation to both supply-side dynamics and differing income growth patterns across regions. Despite rising costs in Delhi-NCR, experts suggest that overall affordability remains within manageable limits for most households. The report underscores that macroeconomic conditions, interest rate adjustments, and policy measures, such as subsidised housing schemes, continue to play a crucial role in shaping affordability trends across urban India.
For Mumbai, the improvement reflects stabilisation in housing prices and a gradual alignment of income levels with property costs. This shift is expected to bolster demand for residential units, particularly in mid-market and affordable luxury segments, while providing a positive outlook for sustainable urban growth. As cities like Delhi-NCR and Mumbai navigate diverging affordability trajectories, urban planners and policymakers face the dual challenge of supporting sustainable property development while ensuring housing remains within reach for the growing urban population.
Delhi NCR Residents Struggle With Housing Affordability While Mumbai Shows Improvement
