For homebuyers, finding a city where monthly repayments fit comfortably within household earnings can matter as much as the property's purchase price. The Housing Affordability Index offers a way to compare these costs across India's major residential markets.
According to Knight Frank India's H1 2026 findings, Ahmedabad remains the most affordable market among the eight cities assessed, while Mumbai and Delhi NCR place a considerably heavier burden on household incomes. These differences could help buyers assess their budgets and housing options as property prices continue to rise.
Knight Frank India, the real estate consultancy that tracks residential market trends, publishes the Affordability Index as part of its housing market research. The figures discussed here are drawn from its H1 2026 Affordability Index report, which measures the share of an average household's income required to pay the monthly equated instalment (EMI) on a housing loan. A ratio above 50% is classified as unaffordable.
The comparison shows that six of the eight markets remain within the report's affordability threshold, supported partly by lower borrowing costs.
| Rank | City or market | EMI as a share of household income |
| 1 | Ahmedabad | 23% |
| 2 | Kolkata | 25% |
| 3 | Pune | 28% |
| 4 | Chennai | 29% |
| 5 | Bengaluru | 35% |
| 6 | Hyderabad | 41% |
| 7 | Delhi NCR | 65% according to Note 2; 67% in Note 1 |
| 8 | Mumbai Metropolitan Region (MMR) | 69% |
Ahmedabad leads the ranking, with less than a quarter of average household income required for the monthly housing loan instalment. Kolkata and Pune follow, while Chennai also remains below the 30% mark. Bengaluru and Hyderabad fall within the affordability threshold, although their ratios are higher.
At the other end, MMR and Delhi NCR exceed the 50% benchmark. The supplied figures differ for Delhi NCR, so its ratio should be treated cautiously.
Lower borrowing costs have helped homebuyers manage repayments, but rising property prices are limiting further improvements. Strong demand, restricted urban land availability, higher construction expenses and increasing land values are adding pressure. The growing preference for premium and luxury homes is also changing the market, as developers increasingly focus on higher-priced housing while affordable-home sales have weakened.
The affordability trend has shifted over time:
Housing demand has also benefited from employment, stable incomes and supportive financing conditions. Residential sales remained near the post-pandemic highs recorded in 2024, according to the report. Lower borrowing costs could continue to support demand in H2 2026, although rising prices may limit further affordability gains.
The city-level differences highlight why buyers need to consider monthly repayments alongside property prices. A lower EMI-to-income ratio leaves households with more income for everyday expenses, savings and other financial commitments. In markets where EMIs absorb more than half of household income, purchasing a home can place greater pressure on household finances.
Ahmedabad, Kolkata and Pune currently offer the lowest EMI-to-income ratios among the eight markets assessed. Mumbai Metropolitan Region and Delhi NCR remain the most challenging, with repayments taking up a substantially larger share of household earnings.
As premium housing gains a greater share of the market, affordability will remain an important consideration for buyers choosing where to live. Lower borrowing costs may provide some support through the second half of 2026, but the balance between income growth and property prices will continue to influence homeownership prospects.
