Gen Z and millennials are displaying stronger intention to move to a new home, preferring homeownership over renting, with city centres remaining a popular choice for choosing to work and live.
According to a recent survey by CBRE, about 45% of Indians intend to move into a new home in the next 2 years, significantly higher compared to global and APAC figures. Out of those who wish to move into a new home, 70% want to buy a house, instead of renting. In contrast to the widely held belief that most people are seeking to move out of urban areas as flexibility at the workplace emerges as a dominant theme, areas close to the city centres still remain the most sought-after choice.
The survey revealed that Indians display more flexibility towards moving or relocating than their global counterparts. The survey found that respondents display a stronger intention to move to a new home in the next two years (44% vs 31% in the previous two years). This is significantly higher when compared to both global and APAC standards.
It is also interesting to note that as most cities in India swell to the beam, the definition of a true city centre continues to evolve. Most leading cities, especially Delhi- NCR, Mumbai, Bangalore, and Pune are witnessing the emergence of suburbs that in many ways redefine the erstwhile “city centre”.
Gen Z led the preference towards moving to a new home in the next two years, compared to only 29% of baby boomers. This indicates that the younger generation will primarily drive upcoming housing demand. Except for Gen X, all other generations displayed a higher preference for locations near the city centres. Gen X displayed a slightly stronger preference for remote locations and a greater desire to move to another country as more experienced professionals seek overseas opportunities. In fact, across age groups, the preference to move to another country was the highest in India (when compared to global or APAC respondents).
The survey also highlighted that of those planning to move, more than 70% wanted to buy a house, instead of renting. While India has always been an economy where home buying is preferred over renting, the uncertainty around the pandemic has further accelerated the need for homeownership and security.
With the pandemic having raised the importance of health and safety, the demand for professional property management services, particularly in apartment buildings has been on the rise. There is also an increasing need for dedicated office space at home as hybrid working becomes more widespread.
According to Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE, “While a majority of the surveyed respondents intend to purchase a house, we should not discount the remaining cohort looking for rental accommodation – 40% of Gen Z would prefer to rent rather than purchase. While 20% of Gen Z would prefer private rental accommodation, 17% look at student housing and shared accommodation as an option. Since this is the age group that will drive rental accommodation, developers must outline strategies to understand and tap demand well in time.”
Further, families are now laying equal emphasis on a property’s quality and surroundings as on the unit itself. Therefore, attractive and thoughtful interior designs, well-planned outdoor areas and surroundings must now be complemented with remote working infrastructure.