Affordability to buy homes has improved in major cities this year driven by a rise in household incomes from a low base of 2020, lower mortgage rates and stable housing prices, according to property consultant JLL India.

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The consultant on Monday launched its annual Home Purchase Affordability Index (JLL HPAI 2021), which signifies whether a household earning an average annual income (at an overall city level) is eligible for a housing loan on a property in the city, at the prevailing market price.

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The index shows that between 2013 and 2021, affordability has increased consistently across key Indian cities -- Delhi-NCR, Mumbai, Kolkata, Chennai, Pune, Hyderabad and Bengaluru.

"During the current year, household incomes witnessed a sharp increase of 7-9 per cent (from the low base of 2020) in the markets under consideration," JLL said.

At the same time, the consultant said that home prices remained stagnant in all of India's prime residential markets except for Hyderabad.

"Moreover, mortgage rates continue to trend at their lowest in 15 years, thereby leading to reduced EMIs for homebuyers, thereby having a significant bearing on affordability," JLL said.

According to JLL HPAI 2021, Mumbai, India's most expensive property market, has witnessed a significant rise in home affordability index, breaching the affordability threshold of 100 this year.

Kolkata is the best market in terms of home purchase affordability.

The current year is expected to witness Hyderabad surpass the 200-mark on the affordability index followed closely by Pune.

The index indicates that an average income earning household in the markets of Hyderabad and Kolkata has enough income to qualify for a home loan on two 1,000 square feet apartments (or one 2,000 square feet apartment) at the prevailing market price.

JLL report defined HPAI as the ratio of the average household income to the eligible household income.

Eligible household income is defined as the minimum income that a household should earn in order to qualify for a home loan on a 1,000 sq ft apartment at the prevailing market price.

A value of 100 means that a household has exactly enough income to qualify for the loan. A value less than 100 implies that an average household does not have enough income to qualify for a housing loan.

A value of more than 100 implies that an average household has more than enough income to qualify for the home loan.

According to JLL report, HPAI of Kolkata is estimated to improve to 218 this year from 201 in the 2020 calendar year.

Hyderabad's affordability index is likely to improve to 203 from 193 while index of Pune may rise to 198 from 186.

The HPAI of Bengaluru is expected to increase to 191 from 176, while Chennai's index could rise to 185 from 174.

Delhi-NCR's index is set to rise to 143 from 132.

The index of Mumbai is estimated to improve to 100 this year from 94 in 2020.