The millennial generation, born between 1981 and 1996, has become a significant force in the real estate market. They are the largest living generation, and their preferences and priorities are significantly impacting the industry. As millennials enter their prime home-buying years, their influence on real estate trends is only expected to grow. In this blog, we will explore the influence of millennials on real estate trends and specifically focus on their impact in India.
I. Introduction
A. Definition of millennial generation
Millennials have been described as the first global generation and the first generation that grew up in the Internet age. The generation is generally marked by elevated usage of and familiarity with the Internet, mobile devices, and social media, which is why they are sometimes termed digital natives. Between the 1990s and the 2010s, people from the developing world became increasingly well educated, a factor that boosted economic growth in these countries. Millennials across the world have suffered significant economic disruption since starting their working lives; many faced high levels of youth unemployment during their early years in the labour market in the wake of the Great Recession, and suffered another recession in 2020 due to the COVID-19 pandemic.
B. Significance of millennials in real estate
Indian millennials are a very important market. They are in their peak buying years an have easy access to home loan. This demographic contributed to over 50 percent of homes sold in 2020, and they were a major driver in the Indian real estate market crossing the mark 54% in 2022.
II. Changing Preferences of Millennials
A. Emphasis on technology and connectivity
Imagine that you’re in the 90s and think about purchasing a property in a crowded metropolitan or a laid-back suburban neighbourhood. It doesn’t matter where you are or what type of property you intend to purchase, you will be subjected to a long series of gruelling processes before getting your hands on a key.
B. Preference for urban living and walkability
he ‘walkable neighbourhood’ is promoted by planners and designers as a normative goal yet resident responses to this environment, the ultimate occupants of these settings, remain unclear. Completing focus groups with 11 diverse residents’ groups, a critically understudied politically engaged population which often seeks to shape planning practice, this paper unpacks residents’ environmental preferences and examines their relationship to neighbourhood attributes commonly associated with walking. Five dominant preferences relating to local amenities, social interaction, noise, greenspace and density were identified. Positive interactions between these and the considered attributes suggest that groups might find much to like in the walkable neighbourhood. The implications for delivering walkable neighbourhoods are considered
C. Demand for sustainable and eco-friendly homes
Sales is about trust and being true to what you’re selling. Thus, making your real estate practice focused on the green home market will show eco-conscious clients that you’re the go-to agency for sustainable real estate. There are many different sustainable home models and aspects in today’s market that you can specialize in.
D. Flexibility in living arrangements
Housing is taken into account as a basic necessity and as society changes, the standard house causes friction with new demands from new ideals of recent time. People are a lot of doubtless to remain in their homes if they can adapt them, and need to change as a result of the absence of alterations to their dwellings as per their desires. Therefore, applying users’ ideas within the designing and planning processes of the lodging could be a key to determine the relation between people’s expected desires and their forthcoming ones. In this fast-changing world, buildings need to accommodate new patterns of tenancy that weren’t anticipated at the time of its construction
III. Impact on Home Buying Trends
A. Delayed homeownership
“Liquidity issues could be cited as the single biggest reason behind project delays in India, a phenomenon that has had an absolutely negative impact on buyer sentiment. The ₹25,000-crore lifeline extended by the government in the form of an AIF (Alternative Investment Fund) would change much of that,” says Mani Rangarajan, Group COO, Elara Technologies, the country’s only full stack real estate technology platform that owns
B. Preference for affordable and smaller homes
A study released by realty consultant Anarock on Monday said that average apartment sizes have shrunk by 27% over the past five years. The liquidity crisis in the real estate industry, strict sanctioning of loans by banks and customers’ preference for affordable homes have resulted in developers offering smaller homes in major cities across India. A study released by realty consultant Anarock on Monday said that average apartment sizes have shrunk by 27% over the past five years — from 1,400 square feet in 2014 to nearly 1,020 sq ft in 2019 so far
C. Focus on location and accessibility
Recent improvements in India’s infrastructure network have been very beneficial to the real estate industry. These kinds of improvements can strengthen regions’ accessibility, create new opportunities, and improve the quality of life there, making it more desirable as a place to live and work. Better transportation systems, including highways, bridges, and public transportation, may increase the demand for real estate in a given area.
IV. Influence on Rental Market
A. Increase in demand for rental properties
Rental housing is the only sector of the real estate market making stupendous profits and soaring high, the question that arises is WHY exactly rentals are this generation's preferred choice. Gen Z and millennials are risk-takers by default. The new-age approach of renting rather than buying and paying off EMIs is an in-built mechanism for them. After going back to normal, this radiant and enthusiastic generation (the largest consumers in the housing market) prefer not to invest and chose rather to rent out as it is easy and much feasible with the changing jobs.
VI. Impact on Indian Real Estate Market
A. Increase in demand for rental properties in urban areas
the past few years, India’s rental market has been experiencing strong demand and growth, particularly in urban areas. This trend has been fuelled by several factors, such as rising migration to cities, increasing urbanization, and a growing preference for rental properties among younger generations.
VII. Conclusion
A. Summary of the impact of millennials on real estate trends
Indian Millennials are the most educated and entrepreneurial generation in India. They have grown up with a different set of values and expectations from their parents. They are more open to new ideas, more tolerant of differences, more accepting of failure, and they have a strong sense of self-worth.
We should not forget that Indian Millennials are the most mobile and socially connected generation in the world. With these attributes, they can be a great opportunity for the real estate industry.
Millennials are the most homeowning generation in history. Homeownership is viewed as a lifestyle and a symbol of good stature for them.
Real estate developers can now tie up with PropTech companies like Reloy and offer loyalty and referral benefits to attract more millennial buyers. This is done by offering rewards or discounts to those who refer their loved ones to the real estate company. Additionally, through Reloy, developers can provide various digital amenities, deals and discounts, events and workshops, infotainment blogs, and more, that will cater to the expectations of the new homeowning generation.
B. Importance of understanding millennial preferences in the real estate industry
The most important factors for millennials when buying a house is having a place that is close to work, good schools, and access to public transportation. Millennials want an urban lifestyle with easy access to restaurants, cafes, malls, and nightlife. They also want their children to have access to outdoor activities. Most real estate developers are understanding the millennial needs and are adapting to the same. They are shifting to completely sustainable projects with amenities that support an ideal lifestyle for young aspiring homeowners.
C. Predictions for the future of real estate trends influenced by millennials
Millennials are driving significant changes in the real estate industry. Their preferences and priorities are focused on technology, sustainability, and affordability. The Indian real estate market is no exception, and developers need to adapt to these changing trends. By understanding the impact of millennials on real estate, developers can cater to their needs and develop properties that meet their requirements. As the millennial generation continues to grow and mature, their influence on the real estate market is only expected to increase.
