As the concept of home and comfort evolves, the housing market witnesses a transformative shift in India. While the sector’s CAGR growth projections show a surge in demand up to 9.8% from 2021 to 2026, the current market milieu also suggests the dynamicity of the demand fuelled by millennials and Gen Z.
The trend for fully managed rental accommodations is a nuanced shift worthy of deep exploration. The most notable factor is the sweeping shift in social preferences due to high disposable income.
High purchasing power
With the growth of e-commerce, finance, and IT sectors, incomes have steadily increased over the last decade. This financial stability coincided with inflated property prices. High disposable incomes juxtaposed with skyrocketing real estate rates in urban centres, resulting in a different socio-economic situation, fuelling the shift towards managed rental accommodation.
According to a survey by Housr, a leading luxury co-living player, 51% of millennials are willing to spend more than 25% of their income on fully managed rental accommodation. Global urbanisation and a yearning for mobility have driven the present generation to aspire for a holistic lifestyle experience that imbibes a premium feel without the hassle involved in maintaining a property and the rigidity of ownership.
Furthermore, the always-on-the-move generation focusses on broadening their horizons and exploring new careers and cities than chasing archaic notions of milestones, such as owning a house.
Convenience over costs
Unlike fleeting social media trends, the shift towards fully managed rental accommodations is poised to be long lasting. A considerable driving factor for this is the increasing desire for work-life balance and a high standard of living among today’s working generation. About 50% of professionals are likely to shell a significant part of their income on fully managed accommodations over traditional ones, as per the survey by Housr.
Higher disposable incomes have a catalytic effect on the spending habit. The allure of a hassle-free, premium lifestyle is more compelling for urban professionals looking for work-life balance. These fully managed accommodations are favourable as they provide a one-stop-shop solution with all-inclusive amenity packs and premium services, such as housekeeping, laundry, 24*7 concierge, etc.
Moreover, the unique socialising opportunities further elevate the lifestyle experience by allowing them access to regular community events, networking opportunities, and a sense of belongingness.
Tech-integration for tech-savvy generation
The tech-savvy generation has remarkably influenced the shift towards managed rental accommodations as these players are quick to harp on this and leverage technological advancements into their offerings. With features, such as advanced search, flexible online bookings, seamless digital payments, smart home technologies, and app-based maintenance requests, managed rental housing meets the expectation of the target much more than traditional housing platforms. Not only renting, but app-based housing solutions have made stay management incredibly effortless, ensuring utmost operational excellence for many brands.
With the integration of the latest technological solutions, including automated access to lighting, locks, and other home appliances, managed rental accommodations further extend their appeal to the technologically driven new generation.
Conclusion
The growing trend towards fully managed rental accommodations in India is multifaceted. Driven by high purchasing power, convenience, preference for tech integration, and the economic pragmatism of the young generation, this shift is redefining the urban living landscape. As we decode this, it becomes evident that the future of housing in India will progressively cater to the needs and preferences of the young and dynamic population.
–The author is co-founder and chief executive officer at Housr.
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