Bengaluru real estate: Millennials, who prioritise stability and financial security, recognise the significance of investing in real estate as a way to meet their basic needs while potentially benefiting from long-term value appreciation, found a new study, on home-buying behaviour of millennials based out of Bengaluru, shared by real estate developer Mana Projects.
It added that real estate investments provide a real asset that can generate a consistent income via capital appreciation over time. This stability creates a sense of security and corresponds with millennials’ long-term financial aspirations of building money and securing their future.
Key findings of the study; Millennial Home Buying Patterns
Expectations when buying a home
Millennials have a unique set of expectations and priorities when it comes to buying a home.
One of the primary considerations for this generation is affordability. Many millennials are dealing with student loan debt and other financial pressures, which can make buying a home challenging. As such, they may be looking for homes that are reasonably priced and will only stretch their budgets a little.
Additionally, location is an important factor for many millennials. They prioritise homes close to public transportation, work, and other amenities, such as WiFi-enabled zones, cafeteria with co-working spaces, entertainment spaces, and open landscaped gardens to stroll amidst nature. Along with this, Millennials are more inclined toward smart, fully automated homes for a more convenient and comfortable lifestyle.
Sustainability and energy efficiency are also important to this demographic, as they are often concerned about the environment and the impact their homes have on it. As such, features like solar panels and high-efficiency appliances can be particularly appealing.
Lastly, millennials tend to value flexibility and low maintenance in their homes. They may be looking for spaces that can be easily adapted to accommodate different needs and activities, and they may also appreciate low-maintenance landscaping and durable building materials that require minimal upkeep.
Current requirements of a new-age home buyer
The requirements of a new-age home buyer are constantly changing in response to new technology and changing lifestyles.
One of the most important requirements for many buyers is smart home technology, including appliances, thermostats, and security systems that can be controlled remotely.
Energy efficiency is also a priority for many home buyers, who are looking for homes that are designed to be environmentally friendly and cost-effective.
Flexibility is also important, with many buyers looking for spaces that can be easily adapted to different needs and lifestyles, such as home offices or guest rooms.
Additionally, outdoor living space has become increasingly popular, as more people spend time at home and seek to connect with nature.
Low maintenance features are also in demand, as buyers seek to minimise upkeep and avoid costly repairs.
Location remains a key consideration, with many buyers looking for homes that are located in convenient and walkable neighbourhoods with easy access to public transportation.
Finally, open-concept living has become increasingly popular, with buyers seeking homes with spacious and flexible floor plans that are ideal for entertaining and family gatherings.
Were there any sources that influenced the millennials buying decisions?
Many sources influence millennials’ buying decisions when it comes to real estate. Some of the key sources of information and influence include:
Family and friends
Millennials are also influenced by family and friends when it comes to buying real estate. They may seek out the opinions of those who have already purchased homes or invested in the market to get a better sense of what to expect and how to navigate the process.
Exposure to Outside World
Millennials are well aware of the current scenarios ongoing at an international level, and their exposure to the outside world allows them to take decisive conclusions before investing in real estate. They have seen unique trends which they might want to inculcate while looking to invest in a residential property.
Digital Revolution Redefining the Experience
Millennials tend to do extensive research online before making any buying decisions, and they often turn to real estate websites and portals to search for properties, compare prices and features, and gather information about different neighbourhoods and cities.
Social media platforms such as Facebook, Instagram, and Twitter are also important sources of information for millennials. They may follow real estate agents, developers, and influencers to get a better sense of the latest trends and offerings in the market.
What % of customers are millennial home buyers?
India is experiencing an increasing number of millennials, aged from 1981-1996, according to American Psychological Association and CBS, as a percentage of the total population. As of 2021, the share of Millennials in India stood at 52%, higher than the global average of 47%, says a report by the UN.
Along with that, a recent study by the UN says, in 2023, 86-90% of the country’s population of Millennials and GenZ are in the tech workforce. This suggests that millennials are actively looking to invest in the property market as a means of building wealth and securing their financial futures.
The reasons for millennials’ preference for real estate as an investment option are many. Real estate is seen as a relatively stable and safe investment option, as property values tend to appreciate over time, and it is a tangible asset that can provide rental income. In addition, with the increasing availability of affordable housing and government incentives such as the Pradhan Mantri Awas Yojana (PMAY), millennials are finding it easier to enter the real estate market.
Furthermore, millennials are driving demand for real estate in India as they seek to purchase homes for themselves and their families. Many millennials are at a stage in their lives where they are getting married and starting families, and this is leading to an increased demand for larger homes in well-connected locations. Developers are responding to this demand by building homes that cater to the needs of young families, with amenities such as children’s play areas and green spaces.
Overall, millennials are having a significant impact on the Indian real estate market, both as investors and homebuyers. As this generation continues to enter the workforce and accumulate wealth, their preferences will likely shape the real estate market for years to come.
Why a sudden increase in home buying by millennials?
Real estate offers a unique combination of financial discipline and stable returns, distinguishing it from other investment options, such as mutual funds or gold, which are often subject to market volatility. This stability makes real estate an attractive choice, particularly for millennials who are focused on addressing both their individual needs and the needs of their families.
Real estate investments provide a tangible asset that can generate a steady income through rental yields or potential capital appreciation over time. This stability provides a sense of security and aligns with the long-term financial goals of millennials seeking to build wealth and secure their future.
Millennials, who are increasingly prioritising stability and financial security, recognize the importance of investing in real estate as a means to fulfil their fundamental requirements while also potentially benefiting from long-term value appreciation.
Many millennials are looking for homes that offer more space, privacy, and outdoor living space than traditional urban apartments. The COVID-19 pandemic has also led to an increased desire for homes with dedicated workspaces and home offices.
Despite facing higher levels of student debt and other financial challenges, many millennials have been able to save up for a down payment on a home, either through diligent saving or financial assistance from family members.
Key observations that MANA has witnessed in rental vs home owned customers
Rental homes are often chosen by individuals who are in the city for a short period, while those who own real estate apartments have established themselves in the city for the long term.
Renting offers affordability, providing a more accessible option for individuals starting their professional lives. They seek rental homes near essential amenities like workplaces, schools, hospitals, and entertainment zones to minimise commute time and maximise convenience.
Renting a home involves lower upfront costs like security deposits and offers flexibility in terms of relocation. However, renters don’t accumulate equity in the property and may face increasing rental payments over time.
In contrast, owning a home requires higher upfront costs like down payments and closing costs. However, it offers long-term financial benefits, such as building equity and potential value appreciation. Homeowners have greater control over their living space, including the freedom to make desired changes and renovations.
Choosing between renting and owning depends on individual circumstances, financial goals, and lifestyle preferences. Renting provides flexibility while owning offers the potential for long-term financial stability, a sense of belonging, and the pride of homeownership.
source : news18