Buying a home has long been considered the ultimate sign of success in India. But for many, it has quietly become the most expensive flex of their lives – one that comes at the cost of financial freedom.
Most people end up buying homes that stretch far beyond their actual affordability. Why? To impress friends, relatives, or neighbors who aren’t the ones paying the mortgage. As financial expert Ca Nitin Kaushik points out, the real estate market is booming, yet homes in India’s largest cities are becoming increasingly unaffordable, even for high-income earners.
The result?
20-30 years of EMIs
Paying nearly twice the property value in interest
Little to no flexibility for career shifts or entrepreneurship
Living paycheck-to-paycheck simply to “look” successful
A smarter approach
Instead of maxing out your home loan eligibility, Kaushik advises keeping EMIs at 25-30% of monthly income and prioritizing breathing space over social approval. “A home should give you shelter, not financial chains,” he says. Your future self won’t care if guests thought your living room was Instagram-worthy – but they will care if you lived life on your own terms.
Skyrocketing prices, shrinking affordability
Property prices in major metros continue to soar. Mumbai leads with ₹15,000-₹25,000 per sq. ft., while Delhi NCR has recorded a staggering 49% annual increase, driven by luxury housing demand and big-ticket projects such as the Noida International Airport. Tech hubs like Bengaluru and Hyderabad remain hotspots, further straining affordability.
Even peripheral areas – Panvel near Mumbai or Dwarka Expressway in Gurugram – are appreciating quickly. Meanwhile, budget housing supply is shrinking, and the luxury segment dominates new launches.
For young professionals, the climb is steeper. Many either settle for smaller homes or stay in rentals longer. Loan dependence is also rising – the National Housing Bank (NHB) reported housing loans at ₹33.53 trillion by September 2024, up 14% year-on-year.
In more affordable cities like Chandigarh, Jaipur, or Hyderabad, repayment timelines range from 16 to 23 years, yet job opportunities often tie workers to expensive metros.
Affordability crisis
The affordability crisis isn’t just personal – it could slow urban growth. In Mumbai or Gurugram, middle-class workers struggle to settle, creating long-term talent retention issues. The NHB notes sharp regional imbalances in housing finance: southern states dominate with 35% of loans, while the northeast receives just 0.68%, deepening disparities.
Government schemes such as Pradhan Mantri Awas Yojana (PMAY) aim to ease the burden, but their reach is limited in premium cities. The NHB RESIDEX index shows prices climbed 6.8% in Q3 2024, hinting at continued upward pressure without bold policy reforms.
Looking ahead
For individuals, the path forward lies in smarter planning: start saving early, explore suburbs or tier-2 cities, compare home loan rates, and choose shorter tenures to cut interest costs. Government subsidies like PMAY can also help first-time buyers.
Because at the end of the day, a home should represent security and comfort – not a lifelong financial trap dressed up as success.