Three reasons why young Indians are keen on buying property

Millennials are the power segment when it comes to home-purchase and reports confirm how over the next few years, they will be among the top buyers of houses in India. Experts suggest that the following generation or Gen Z too will be investing in property. In fact, a global survey conducted by real estate experts CBRE released this week shows that 44 per cent of young Indians are keen on buying a house in the next two years – which is a much higher percentage than the rest of the globe. Three main factors are responsible for driving this trend:

Increased affordability among young professionals
With the development of affordable housing projects, many millennials are able to purchase homes at relatively lower prices than what was available in the past. Additionally, a surge in housing development all across the country over the last decade has made house-buying a strong investment option for this age group. The trend has become even more pronounced in the post-pandemic period. Yash Miglani, MD, Migsun Group says, “Millennials, particularly in the post-pandemic era, have emerged as a significant homebuying demographic, accounting for a sizable portion of home purchases. Initially, the experts thought this trend was only because of working from home (WFH) and may go away again after the return to office sets in. However, it is only growing by leaps and bounds. Additionally, the fact that both partners are often employed and have a stable income has contributed to the rise in millennial homebuying. As this generation matures and accumulates wealth, their impact on the real estate industry is poised to become even more substantial.”

Easy home loan facilities 
Attractive home loan schemes with low-interest rates and long repayment tenures with flexible payment options are making it easy for millennials to purchase a house. This has led to a significant slide in renting trends while pushing house-buying. Anshuman Magazine, Chairman and CEO - India, South-East Asia, Middle East & Africa, CBRE explains, “While a majority of the respondents intend to purchase a house, we should not discount the remaining cohort looking for rental accommodation – 40 per cent of Gen Z would prefer to rent rather than purchase. While 20 per cent of Gen Z would prefer private rental accommodation, 17 per cent look at student housing and shared accommodation as an option. Since this is the age group that will drive rental accommodation, developers must outline strategies to understand and tap demand well in time.”

Changing lifestyle preferences
Homeownership has gained priority over expenses like travel or entertainment especially during the pandemic as increasingly people seek stability and security. A combination of these factors has made it easy for millennials to become homebuyers, and this is expected to continue in the years to come. Amit Modi, Director, County Group explains, “Millennials and Gen-Z, aged between 25-42 years, have reached a mature phase of their lives and would naturally develop a desire to make long-term investments in the bid to secure their futures. Home investments or real estate have emerged as a reliable, durable, and secure investment portfolio, with a definitive possibility of income generation through rentals and sales, even in times of crisis. Today’s generation is financially educated and knows the pros and cons of investing in different avenues. Post-evaluation, they are making wise calls and, therefore, have shown an inclination towards investing in homes.”