In developing countries like Pakistan, affordability to own a decent house is a critical issue for middle to low income households as the cost of plot and construction has increased enormously over the last couple of years as compared to household income. It affects the socio-economic environment of the country and the households. Hence to provide affordable housing not only is it required to lower the cost of the house but a range of social and economic determinants need to be addressed. This paper examines these social indicators, like household size (HH), marital status, education, unit/plot size, location and economic determinants (income, expenditures, unit cost) of affordable housing and its relationship to affordability. The paper presents findings from household questionnaire survey in Murree urban area. Findings show that lack of affordable housing has resulted in overcrowded low quality housing with substandard infrastructures that have highly affected the socio-economic status and well being of the households. The majority of the respondents demanded small size unit and plot as per their affordability. In spite of lower income the respondents preferred to own their houses. Keywords: Affordable housing, socio-economic status, location, low-income housing, hilly area, Pakistan