Buying your own home is more affordable now :)

Buying House

Buying your own home is more affordable now than it has been in the last four years.

🙂

The average price of a house is around 4.5 times the buyers’ average annual income, against 4.6 times in 2005.
In 2007, the affordability factor had increased to 5.1% due to a sharp rise in real estate prices.

🙂

However, with the prices of new houses dropping by around 30%, the number of years’ income required to buy a house has come down to 4.5 times.

Developers have also realized the need to introduce affordable housing and are reducing the size of dwellings and omitting amenities like Italian marble and modular kitchens, which drive up costs, in a bid to cater to the huge untapped demand.

🙂

Housing finance major HDFC calculates the ‘affordability factor’ based on the data of its home loan borrowers.
At 4.5 times of annual income, the average EMI would be around 50% of a buyer’s income.

In the home loan market, it is considered within the affordable range.

🙂

With interest rates also softening in the last six months, demand has got a further boost. 🙂

Improved affordability seems to be translating into better sales.
In this quarter, housing finance firms have seen a good increase in demand compared to the previous one, ie January to March 2009.

🙂

With affordability factor in buying houses improving, demand for home loans have also increased.

🙂

2 responses to this post.

  1. I used google translate to understand, because my English so bad. I think this great article. Thank for sharing.

    Reply

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