Representative image showing a house
Credit: iStock Photo
As per a recent report, to buy a house in Mumbai, the richest 5 per cent of urban families need to save up money for 109 years.
A Times Of India report compared different states and how much savings is needed to buy a house in the largest city of the state. The study was done by comparing "income of top 5 per cent households" with the average price of a 110sq m (1,184sq ft) house in the city.
The largest cities were compared, which included Mumbai, Gurgaon, Bengaluru, Delhi and Chandigarh.
The data shows that top 5 per cent of the richest will need 109 years of savings to buy a house in Mumbai, while Gurgaon is listed second, with 64 years of saved up money for the same house.
Compared to Mumbai, top 5 per cent of the richest Bengalureans will need 36 years of savings, while people in Delhi needing 35 years of savings and Chandigarh 15 years.
Income of top 5 per cent families in urban areas was derived from average Monthly Per Capita Consumption Expenditure (MPCE), which was higher compared to rural families. The MPCE for urban areas for top 5 per cent would be Rs 22,352 per person a month.
The report mentioned India's gross savings to GDP ratio to be 30.2 per cent in 2022-23. Which means income for a family of four for instance in Mumbai would be Rs 89,408 per month.
The GDP ratio rate was then applied to the top 5 per cent richest in the city, their annual saving was Rs 3.2 lakh, as per the TOI report.
The report further stated that in Odisha, it would take over 50 years of savings for the richest 5 per cent to buy a house in Bhubaneswar.
The top 5 per cent of the richest in Chandigarh would need the least number of savings, which is 15 years, to buy a 1,184 square feet house.