With new growth coming up, by 2030, most of the new homeowners would be represented by Millennials and Gen Z, those influential voices of India’s emerging market. This fact comes to light from a recent report published by JLL, the world’s leading real estate services firm, that 60% of the future housing stocks will go to these two generations, which reflects the socio-economic condition of the country.

Millennials and Gen Z: Who Are They?

Millennials, the Generation Younger cohort, born in the early 1980s to the mid-1990s to up to early 2000s, are Generation Y. Generation Z are those born from mid-to-late 1990s to early-2010s. Millennials and Gen Z together form a large part of the workforce and consumer base in India, thus being instrumental in many market and industry trends.

Summary Key Drivers of Home Ownership Growth

Low-cost Financing Facilities

One of the key factors responsible for making possible the rapid increase in homeownership is the provision of cheap finance. Government-backed schemes and lower interest rates have opened doors for Millennials and Gen Z buyers to procure loans and invest in property.

Urbanization and Changing Lifestyle

Rapid urbanization completely changes the housing market India. By 2025, it is predicted that urban home ownership will increase to 72percent from 65percent in 2020. Reasoned better living standards and proximity to urban amenities, especially by the Millennials and Gen Z.

Technological Innovations

The application of technology to real estate has simplified the process of buying a house. Virtual tours of properties, AI-driven recommendations, and transactions through blockchain facilitate home purchase for tech-savvy Millennials and Gen Z.

Emerging Growth Centers in Tier II and III Cities

Smaller cities like Jaipur, Indore, and much more like Kochi are now emerging pockets, focusing on housing development. By 2025, these Tier II and III cities are projected to contribute to over 40% of new housing developments. Reasons for this growth include:

• Lower Property Costs: The real estate prices that are affordable will lure first-time Millennials and Gen Z buyers into the market.
• Improved Infrastructure: Cities now are interconnected better with amenities and, therefore, are attractive options one can consider as a residential location.
• Employment Opportunities: The growing prominence of remote jobs and the establishment of business hubs encourage people to move to the regional cities.
• Sustainability: A Non-Negotiable Factor
• Sustainability is coming down from being a fancy and is now fast evolving into an inevitable thing in the housing market. By 2025, green-certified buildings are expected to contribute 30 per cent of the new residential projects, compared to 15 per cent in 2020. The trigger of this change includes:
• Environmental Awareness: Sustainable ecology is one factor that millennials and Generation Z take into consideration while buying their homes, as they see themselves equating such a purchase to reducing their carbon footprints.
• Cost Savings: Utility bills are cut down by energy-efficient buildings.
• Government Incentives: Policies that promote sustainable development will encourage green construction.
• Smart Homes: The Future of Living: Millennials and Generation Z are showing the most interest in smart homes. Automated lighting, smart security solutions, and energy management systems are all proving to be attractive features of comfort. Such spaces integrate technology to their living environments, following the preferences of the younger digital generations.
• Economic Impact of Housing: The housing sector is expected to contribute about 13% to the country GDP by 2025. This indicates the growing potential sector and its resilience. It is projected to be a USD 1-trillion market by 2030, and the main growth drivers for this sector are:

i. Demographic transitions: Millennials and Gen Z buying houses

ii. Policy reforms: Steps such as RERA (Real Estate Regulatory Authority) are heightening buyer confidence.

iii. Global trends: Adoption of global best practices in construction and design.

Affordable Housing Initiatives

Government programs such as Pradhan Mantri Awas Yojana have made houses much more reachable for low- and medium-income groups. The benefits are tax and subsidy encouragement under these schemes in the millions that would favor acquiring first homes by young and budding homeowners-investors.

Crisis Optimistic as it sounds, the housing sector has several challenges including:

• Supply chain disruptions: Delay in construction materials will affect project schedules.
• Regulatory hurdles: Lengthy and complex processes in approval will act against promoting new development.
• Affordability: Rising land values in urban habitats could constrict access to some Millennials and Gen Z customers.

Conclusion

A decade hence, the Indian housing market will itself be a paradigm of change. With the Millennials and Gen Z leading, the sector is changing to embrace their choices of sustainability, technology, and affordability. Tier II and Tier III cities will increasingly evolve into growth hubs while governmental initiatives assure buyer confidence, thus breaking the dream of homeownership into reality for millions.

It is obvious that the signposts of change will become essential for prospective buyers and industry stakeholders alike. There, in that future with a clear blue sky, lay the expectations of India that the housing market would come along with it: growth beyond the immediate future and the promise of opportunities for both Millennials and Gen Z.