Millennials are at the helm of most major industries as the customers and the decision makers. Their influence now impacts the Indian real estate sector considerably since they make up a majority of the demographic.
It is estimated that around 65% of the Indian population will be under the age of 35 by the year 2020. While still in the nascent stage, the interest of the Millennials is shifting towards investment and is bound to drive real estate majorly. Logically, the benefits of real estate investments are not only for them to reap, but the country as well. In the following information, you will find reasons why investing at a young age is now a trend.
No need to pay rent.
According to a report, more than 80% of the millennials live with their families. Within the next 2-5 years, 23% of these will move out. The majority of them, it seems, realizes that instead of spending hard-earned money on rent, little planning will help them get a home of their own within a few years. And even if the property isn’t utilized personally, they can collect rent while sharing an apartment.
Coming of age.
Simply put, this is their time to invest. With access to the digital world, they are more tech-savvy and generally more informed than their predecessors. This puts them in a better spot to compensate for incurred losses if any. 35% of the Millennials, according to reports, turn towards real estate for the sole purpose of investment; something for real estate companies to consider.
Are the Millennials skeptical of the stock market?
Survey takers were asked to choose between stocks, real estate, commodities, bonds, and cash equivalents such as oil, gold, and cotton as the best-performing investment since 2000. Among all, 40 percent reported uncertainty around which asset class performed best, and 25 percent believed the stock market was the best investment.
Will the real estate flourish with Millennials leading the charge?
While old people may be more interested in downsizing, Millennials are having children and growing in their careers. Buying a home is the next logical step. With prospective returns potentially on the horizon, Millennials are on the right track. The data says real estate has the capacity to be the best investment, and Millennials are on board.
Availability of alternatives.
There are options that substitute direct substantial investments. Real estate investment trusts (REITs) are a great option for Millennials hoping to spend less than a fortune. Publicly traded companies that invest in commercial properties like office spaces, shopping malls, apartment real estate etc. ought to focus on the potential capacity of millennial to invest and vice versa.
Stability and extra income.
Regular 9-5 jobs are a thing of the past. With dynamic working hours and a modern lifestyle, extra income is always welcome. The likes of Warren Buffet mention the essence of earning besides the primary source of income; as it turns out real estate is a great source. It helps in attaining stability in the long run which is often associated with owning a house in the Indian community.
Security & traditions.
First and foremost, owning a home is a symbol of financial stability and therefore, emotional security. While it agrees with family traditions, they are free from the motives of landlords. On the other hand, contrary to popular notions, Millennials heed the essence of family life and strive to contribute. They are pooling money with their families to buy properties that can be utilized as per requirement.
Moreover, they realize opportunities abroad where they get better returns especially in state capital. Millennials have better mental rehabilitation mechanisms against plans not working. What’s more is that companies are investing accordingly to promote mutual benefits!
One truth about the real estate market has been constant, even for Millennials – while it is not all about ‘location, location, location’ for them, location is still certainly very important. It’s just that core location’ is no longer the Golden Rule – Indian Millennials are far more inclined to purchase their first homes in the suburbs, not in the city center.
They are also far more likely to purchase homes in high-rise complex and organized gated community with security and all modern amenities. Also their own schools, healthcare, and shopping/entertainment facilities in nearby vicinity. Location with good connectivity to their own office complexes offering traffic free possibilities to major employment hubs such as IT parks and manufacturing belts are the most preferred.