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Mortgage Rates Not a Major Barrier for Homebuyers

A nationwide survey examining the mindset of Indian homebuyers has revealed that mortgage interest rates are not the primary factor discouraging people from purchasing homes. Instead, rising property prices, economic uncertainty, and affordability concerns are having a greater influence on buying decisions. The survey was conducted across around 20 major cities in India , including Delhi-NCR, Mumbai, Bengaluru, Hyderabad, Chennai, and other important urban markets. It explored consumer attitudes toward housing affordability, loan eligibility, and long-term financial commitments. Property Prices Are the Biggest Concern According to the survey findings, the majority of respondents believe that housing prices have increased much faster than salary growth. About 82% of respondents said that the sharp rise in property prices compared with income growth has become the biggest obstacle to purchasing a home. This imbalance between income and property costs is pushing many potential buyers to delay or reconsider their home purchase plans. Mortgage Rates Rank Lower Among Buyer Concerns Although interest rates for home loans have increased in recent years and currently range around 8.5% to 9% , many buyers do not consider them the biggest challenge. Around 74% of respondents stated that mortgage rates were only their fourth major concern when thinking about buying a home. Only about 26% of participants said that higher home loan interest rates significantly affected their decision to buy property. This indicates that while borrowing costs matter, other financial pressures have a greater impact on the housing market. Job Security and Living Costs Affect Homebuying Plans The survey also highlighted other financial concerns that influence housing decisions. Around 70% of respondents said job market instability makes it difficult to commit to long-term property purchases. Nearly 68% pointed to rising daily living costs , such as food and household expenses, as a major factor affecting their ability to buy a home. These factors reduce the amount of disposable income available for housing investments. Debt-to-Income Ratio Plays a Key Role Another important issue identified by the survey is the debt-to-income ratio , which determines how much loan a buyer can afford. Approximately 78% of respondents believe their income level may not support the loan required to buy a home , making financing difficult even if interest rates remain manageable. This suggests that affordability and financial capacity are greater challenges than interest rates alone. Growing Concern About Housing Affordability Many potential buyers feel that owning a home is becoming increasingly difficult. The survey found that 74% of participants worry they may never be able to enter the housing market if prices continue to rise at the current pace. Some respondents also indicated that purchasing a property might only be possible if they receive financial support from inherited family property or savings. Demand for Policy Changes Participants in the survey also expressed their views on housing policies. About 62% suggested that home loan interest rates should vary across different housing segments , such as affordable and luxury housing. Around 70% questioned the logic of applying GST on affordable housing , arguing that it increases the cost for middle-income buyers. These opinions highlight growing concerns about affordability within the real estate market. Conclusion The survey indicates that mortgage rates alone are not the main barrier to homeownership . Instead, rising property prices, uncertain job conditions, and financial limitations are the primary reasons many potential buyers are postponing their home purchase decisions. For the housing market to remain accessible to middle-income families, experts believe that improving affordability and aligning property prices with income growth will be more important than changes in interest rates alone.