Why Middle-Class Indians Still Can’t Buy Homes At 35, Despite Higher Salaries

Experts say the real problem isn’t low income, but the widening gap between salary growth and asset prices.

Buying a home has long been considered a key milestone of financial stability in India. Yet for many middle-class Indians today, owning a house remains out of reach even by the age of 35. Financial experts say the reason lies not in poor earnings, but in a deeper structural imbalance between salaries and asset prices.

According to Akshat Shrivastava, hedge fund manager and founder of the financial education platform Wisdom Hatch, the issue is best explained through the concept of asset price appreciation. In simple terms, this means that the prices of assets such as real estate, land, gold, and stocks have risen much faster than salaries over the past few decades.

Shrivastava points out that while income growth may appear impressive on paper, it often merely keeps pace with inflation. He illustrates this with a comparison from 1990, when a monthly salary of around ₹3,500 was considered reasonable. Adjusted for an average inflation rate of about 6 per cent, that amount is roughly equivalent to ₹27,000 today. Coincidentally, India’s current average monthly salary is estimated to be between ₹27,300 and ₹29,400.

The comparison reveals a critical insight: salaries have largely preserved purchasing power, but they have not created additional buying capacity. Meanwhile, property prices have surged far beyond inflation. Data from property platforms and consultancy firms show that house prices in major metros such as Mumbai, Delhi and parts of Bengaluru grew at 10–11 per cent annually between 2000 and 2020. Even at a national level, average house prices rose by about 6 per cent per year, with sharp spikes in urban centres.

As a result, younger generations find themselves earning more in nominal terms but able to afford less when it comes to major life goals like home ownership.

Shrivastava also links the affordability crisis to easier access to debt. Since the global financial changes following 2008, borrowing has become increasingly normalised. In India, several fintech companies have entered the lending space, making credit widely available. While this has improved consumption, it has also fuelled price inflation in assets.

“When more people buy assets using borrowed money and those assets are traded frequently, prices amplify further,” Shrivastava has noted. This cycle benefits those who already own assets, as their wealth grows rapidly, while first-time buyers are pushed further away from ownership.

Income data reinforces this trend. India’s nominal per-capita GDP increased from about USD 1,450 in 2013 to USD 2,256 in 2023, translating to an annual growth rate of roughly 4–5 per cent in dollar terms. Even with slightly higher growth in rupee terms, incomes still trail behind the double-digit property price inflation seen in many Tier-1 cities.

Experts say this growing mismatch is reshaping the idea of financial security for the middle class. For many urban families, renting longer, delaying home purchases, or moving to peripheral areas has become the norm rather than the exception.

The takeaway, economists argue, is that the struggle to buy a home is not a personal failure but a systemic outcome of slow salary growth and rapid asset inflation. Unless income growth accelerates or housing supply improves meaningfully, the dream of owning a home by 35 may continue to slip out of reach for India’s middle class.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Property prices, income trends, and investment outcomes may vary by region and individual circumstances.