Owning a house used to be the great Indian dream but although this trend is changing, some 60 per cent of millennials still favour buying over renting. This generation exerts major influence on market trends as it has more money, leisure time and technology than preceding ones.
In some circles, owning property still signifies financial success and a move up the social ladder. “People generally consider investing when they have attained financial stability,” says Ashwinder Raj Singh, CEO — Residential Services at JLL India. “Even though there are various options available, real estate as an asset class lies close to the hearts of most Indians because of the traditional sentiment associated with home ownership.
“While there is an increased tendency among millennials to wait and watch, the desire to purchase definitely exists in their psyche. But it’s a question of purchasing power and risk appetite when it comes to investors, and purchasing power coupled with aspiration in the case of buyers looking at it for personal use.
“The right doses of these attributes can be found in the age group between 35 and 48.”
Personal vs investment
Additionally, noting the millennials as the wealthiest generation that India has ever had, experts say a major factor attributing to this is also the earning age. “Today, the average age of a homebuyer is 30-35, while it was about 45 a decade ago,” says Gauri Sehgal, Director of Gulf Asia, a business management firm with offices in India, Dubai and the Philippines. “Earlier, people would stress on location, but millennials are talking about imported fittings and other lifestyle features.
“Generation Y wants an independent yet secure life. Importantly, many parents opt to give their daughter a house instead of the customary wedding dowry. Having a celebrity in the neighbourhood is becoming an added status symbol.”
Smart choices
“Millennials will potentially reshape the Indian economy,” says Snehal Mantri, Director — HR at Mantri Developers. “They will use their unique experiences to make more refined buying and selling decisions and force developers to change their customer interface methodology.”
Holding the view that an affinity to technology will reshape the property buying experience, she adds, “They look for technologies that offer project information, reviews and price comparisons at their fingertips. Sure to create a more informed market of homebuyers, they do their research and are already aware of the kind of property options that will best suit their budget.”
The company keeps these aspects in mind, Mantri says. “We offer semi-automated homes and have introduced several innovative marketing technologies such as touchscreen tables and digital information kiosks and iPads at project sites for enhanced customer interface.”
Cities on top
Geographically, Generation Y has the biggest influence on property markets in Mumbai and Bengaluru because these cities are where a lot of them are employed, says Arvind Jain, Managing Director of Pride Group. “Moreover, with most of them opting for nuclear families, the demand for new homes is always increasing.
“At the peak of their earning abilities, they are willing to spend on residential complexes that provide lifestyle features such as a clubhouse, swimming pools, children’s play area, reserved parking and high-level security.”
These factors also explain the allure of Kochi, says Dr Baju George, Managing Director of SmartCity in Kochi. “A burgeoning hub for IT/technical talent, [Kerala] has a vast population of educated youth, with a large number of this workforce being women.”
The township, slated for completion in 2019, will have apartment blocks, education and health-care institutions, recreation hubs, shopping malls and hotels.
Singh says another trend is emerging in south India. “Young, professional, well-established NRIs from Kerala and Tamil Nadu show a greater predilection towards investing in homes in their native cities.
“This can be attributed to the stronger socio-traditional mindset towards home ownership and providing security and stability to their families.”
