The Indian real estate sector is poised for significant growth as millennials become the primary homebuyers in recent years.
With the increasing desire for homeownership, millennials accounted for 54% of all homes purchased in India in 2022. Recognizing the stability and potential returns of the real estate market, millennials are diversifying their investment portfolios by considering real estate assets as an alternative to financial instruments like mutual funds and stocks.
Industry experts suggest that real estate developers with reputable brands and a track record of successful execution are likely to be the beneficiaries of this shift in buyer profiles.
The Managing Director of Century Real Estate Holdings Pvt Ltd. highlighted some key factors
Ravindra Pai, the Managing Director of Century Real Estate Holdings Pvt Ltd, highlighted some key factors contributing to the changing dynamics. He stated that millennials have a growing need for customized living spaces in urban areas. Additionally, millennials highly value community living and seek residential communities that foster connections and social networks.
Furthermore, buying a home is no longer just about finding a place to live for millennials. It has become a reflection of their lifestyle. These factors have significantly contributed to the increased demand for homeownership among millennials.
India is home to a vast population of millennials, with over 450 million individuals and a collective spending power of approximately $330 billion. The country also boasts one of the largest urban populations in the world, surpassing 500 million. The urban GDP contribution is expected to grow to 75% by FY30 from 63% in FY20. Moreover, India possesses the largest pool of digitally skilled and STEM talent globally, as per CBRE, a real estate consultancy firm. These favorable demographics, coupled with rising spending power, bode well for the Indian real estate sector.
Global Exposure and its Impact on Millennial Homebuying Preferences
Millennials view homes as crucial investment instruments reflecting their aspirations.
52% of participants choosing real estate as an investment class are millennials.
Global exposure drives millennials to seek homes with international standards.
Community living is highly valued by millennials, leading to a focus on gated communities.
Millennials prioritize sustainability and are willing to pay a premium for eco-friendly living.
Millennials are digitally inspired, preferring virtual tours and digital transactions.
Integrated properties attract millennials, who see homeownership as a long-term investment.
Millennials' confidence in financial familiarity boosts the real estate market.
Millennials are reshaping the housing sector and are no longer just the "rent generation."
Conclusion
In conclusion, the Indian real estate sector is experiencing exponential growth driven by the increasing participation of millennial homebuyers. Millennials, accounting for a significant portion of home purchases, recognize the stability and potential returns of real estate investments. Reputable developers are expected to benefit from this shift in buyer profiles. Key factors contributing to the changing dynamics include millennials' preferences for customized living spaces, community living, and homes that reflect their lifestyle. India's large millennial population, urbanization, and favorable demographics further contribute to the growth potential of the real estate sector. Global exposure influences millennial homebuying preferences, with an emphasis on international standards, sustainability, and digital innovations. Millennials' confidence in homeownership as a long-term investment and their impact on reshaping the housing sector highlight their significance in the real estate market.
