Planning to buy that dream house you always wanted in Mumbai? Think again, unless your annual take-home salary is at least Rs. 20 lakh per annum.

That is the minimum you must earn if you want even a modest home in the Mumbai Metropolitan Region (MMR), shows a recent research by Liases Foras, a real estate rating and research firm. And the average income of a Mumbaiite is Rs. 1.41 lakh per annum, according to the latest state economic survey.

This means he or she can only afford a house worth around Rs. 6 lakh.

“The weighted average price of an apartment in MMR is Rs. 1.1 crore and to get a housing loan, the buyer must have an average salary of Rs. 20 lakh per annum. This despite the fact that developers in metros, and especially in Mumbai, are facing cash flow issues,” said Pankaj Kapoor, managing director, Liases Foras.

In the last two years, most real estate developers  have been positioning their offerings as luxury projects. The high prices have led to a considerable fall in demand: by about 25% year on year in 2012.

“There are developers who are under financial stress but even if they were to correct the prices I don’t think people are willing to take the risk and buy from just anybody. They have become very choosy,” said Abhisheck Lodha, managing director, Lodha Group.

The developer last Friday launched a luxury project in Wadala — designed by Philippe Stark — where apartments  cost Rs. 5 crore and more. Lodha claims there is still demand for apartments built by prominent developers for between Rs. 25 lakh and Rs. 5 crore in Mumbai.