Are Millennials driving the real estate sector?
By 2020, India is expected to become the youngest nation in the world, with an average age of 29, thus emphasizing the massive role of its millennial generation in driving the growing economy. Changing living patterns and the advent of innovative technology are strategic reasons behind this paradigm shift.
Millennials – those born after 1982, account for a third of India’s population and 46% of its workforce. In the next 10 years, millennials are estimated to constitute 75% of India’s work force. This is a self-made generation where a majority of them are already the chief earners in most households at a very young age.
With millennials starting their careers at an early age, they are more financially sound about diversified investment options with an aim to secure their future. Generating regular income at an early age has definitely lured them into splurging on a luxurious urban lifestyle, while sublimely instilling the need for ‘savings’. Real estate has always been the most popular option as a safe investment yielding maximum returns and for future ownership. Moreover, flexible and innovative home loan schemes have eased out payment options for the millennials while investing in properties. Most of the banks now offer personalised services thereby making property investment lucrative.
With millennials wanting to have their individual space as nuclear families, owning a home makes it to the top of the investment list.
According to a study done by CBRE Group Inc., 82% of millennials in India currently live with their parents with over 25% having no intention of leaving the family home. 23% of the millennials, who currently stay with their parents, are looking to move out in the next 2-5 years. 65% of them desire to acquire a property in the future without compromising on their quality of life. Millennials in India and China are most highly inclined towards acquiring new properties in the near future. While for the Chinese millennials, the main objective for purchasing properties is to help stabilize their lives, the Indian millennials buy homes as a reliable mode of investment. Investing in real estate makes it a preferred alternative as it helps secure their future.
India’s financial capital – Mumbai, one of the most expensive real estate markets, has seen the launch of smaller sized homes in the last 2 years to cater to the needs of the increasing segment of nuclear families and youth that are aspiring to invest or live in their own homes, early on in their life. The millennial generation (at 32%) is largely driving the housing market. Technology is a huge driver for millennials in the real estate sector. With busy schedules, most of them rely heavily on social media and internet research. An engaging website with comprehensive project details and images is vital for real estate professionals.
Many factors influence the purchasing patterns of millennials. Millennials crave flexibility, convenience and affordability in every aspect of their lives and hence prefer well-designed and compact spaces. Their inclination towards local convenience and connectivity takes a higher precedence over luxurious locales. For e.g. one of our projects, Piramal Aranya, enjoys easy access to South Mumbai via JJ Flyover and the Eastern Freeway that has opened connectivity to northern Suburbs and Navi Mumbai. Committed to bringing trust and transparency to the real estate sector, renowned builders are now providing assurance benefits to the consumers. Thus, influencing
millennials to rather invest their funds with a well-known and established developer than in projects from unknown developers. Piramal Realty has always aimed to enrich lives by setting new standards for customer centricity, architectural design, quality and safety.
While the long-term goals of millennials are well aligned to those of their older generations, there is a visible shift in attitude towards their current living, working, and recreation preferences. While Indian millennials consider property as an investment, they also consider their homes and offices as more than just destinations to live and work.
They see them as communities that weave individuals into a social environment fostering a holistic lifestyle creating avenues to interact with neighbors, colleagues, and friends. Paying close attention to and incorporating the preferences of today’s millennials is a crucial factor in shaping the growth of the real estate sector. As future decision-makers, millennials will definitely continue to be at the forefront of the housing ecosystem and to a large extent influence industry trends.