Houses in Hyderabad may remain expensive as repo rate stays same

Hyderabad: Houses in Hyderabad may continue to be expensive as the Reserve Bank of India (RBI) has kept the repo rate unchanged.

In the first half of 2024, the EMI-to-income ratio in Hyderabad was 30 percent, according to the Affordability Index by Knight Frank India, a property consultancy.

Impact of repo rate on EMI-to-income ratio for houses in Hyderabad

Since the RBI has left the repo rate unchanged, EMIs on loans will not decrease, affecting the EMI-to-income ratio, which is currently 30 percent—the second highest in India after Mumbai.

In Hyderabad and other cities, most homes are purchased through loans. A cut in the repo rate would have resulted in lower interest rates on home loans, making EMIs more manageable for borrowers.

Second most expensive market in India

The residential real estate market in Hyderabad remains the second most expensive in India after Mumbai.

Although the city is the second most expensive market in the country, affordability has not changed since 2022, with the EMI-to-income ratio remaining constant for the past two years.

From 2010 to 2021, affordability (measured by the EMI-to-income ratio) improved, but it slightly increased in 2022. Since then, it has remained the same in Hyderabad.

Following are the EMI-to-income ratios of various cities in India:

City	2010 (percent)	2019 (percent)	2020 (percent)	2021 (percent)	2022 (percent)	2023 (percent)	H1 2024 (percent)
Mumbai	93	67	61	52	53	51	51
Hyderabad	47	34	31	28	30	30	30
NCR	53	34	38	28	29	27	28
Bengaluru	48	32	28	26	27	26	26
Chennai	51	30	26	24	27	25	25
Pune	39	29	26	24	25	24	24
Kolkata	45	32	30	25	25	24	24
Ahmedabad	46	25	24	20	22	21	21

Despite being the second most expensive real estate market in India, Hyderabad’s property market has emerged as one of the top choices for NRIs.

A significant percentage of NRIs residing in the US, Canada, the Gulf, Europe, and other regions prefer housing units in Hyderabad.

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