The Indian real estate market is witnessing a revolution, and leading the charge is none other than millennials. This generation, infamous for redefining everything from avocado toast to work-life balance, is now turning its disruptive power towards the housing market. In fact, millennials—those aged 25-40 years—are no longer just scrolling through #DreamHome hashtags on Instagram; they’re making those dreams a reality. According to Knight Frank’s India Real Estate Outlook 2023, millennials now account for a staggering 65% of homebuyers in major urban centers, forcing the real estate industry to rethink its entire playbook.
This shift in homebuying patterns is not just about numbers—it’s about a complete reimagining of what real estate means. With their distinct tastes, tech-savvy mindset, and demand for flexibility, millennials are reshaping the housing market in ways that no other generation has before. And the impact? Developers, brokers, and financial institutions are scrambling to keep up with this generational shift, ensuring that homes and property investment options align with millennial values and aspirations.
Millennials have often been labeled the “renting generation,” but that’s quickly changing. Recent data from JLL’s Homebuyer Sentiment Index shows that 61% of millennials are planning to invest in real estate within the next three years, and 46% already own a property. But their approach isn’t just about buying any home—they’re bringing their unique flair into the process. Millennials aren’t just binge-watching home makeover shows or daydreaming about spaces; they’re actively participating in the real estate market and driving its evolution.
Take Nishant, a 32-year-old software engineer, for instance. Instead of opting for a traditional suburban home, he invested in a fractional ownership model for a commercial property. This flexible, innovative approach allowed him to diversify his investments while still planning for future residential purchases. Stories like Nishant’s show how millennials are changing not just where and what they buy, but how they invest in real estate.
A digital-first approach helping in redefining the real estate process
This generation, raised in the age of smartphones and instant connectivity, has been instrumental in accelerating the digital transformation of the real estate sector. According to JLL’s Technology in Real Estate Survey 2023, online property searches by millennial buyers in Tier I cities have surged by 28%. Housing.com, one of India’s leading property portals, reports that millennials between 25-40 now make up almost 60% of their total user base.
Millennials’ “digital-first” mentality has turned the once complex and slow-moving property transaction process into something much faster, transparent, and tech-driven. From virtual tours and AI-powered home recommendations to blockchain-enabled property transactions, the real estate sector has embraced the digital shift. This trend is only growing stronger as developers and brokers adapt their services to meet millennials where they are—online.
Prioritising sustainability: Green is the new luxury
Millennials are not just buying homes—they’re demanding that these homes reflect their values, particularly when it comes to sustainability. The environment-conscious mindset of this generation is shifting preferences toward eco-friendly, energy-efficient homes. According to a CBRE India Report, 68% of millennial homebuyers are willing to pay more for green-certified buildings.
This demand for sustainable living is driving developers to incorporate green features like rainwater harvesting, solar panels, and energy-efficient systems into their projects. Smart homes—equipped with IoT-enabled devices that monitor energy usage, air quality, and water conservation—are also gaining immense popularity. For millennials, it’s not just about owning property, it’s about owning the right kind of property—one that contributes to a healthier and more sustainable future.
The rise of fractional ownership where flexibility meets innovation
In keeping with their desire for flexible investment options, millennials are increasingly drawn to fractional ownership—a model that allows multiple individuals to co-own high-value assets like commercial properties. According to Knight Frank India, fractional ownership platforms have seen an 85% rise in millennial investors between 2021 and 2023, with typical investments ranging from Rs 30-60 lakh.
This model offers millennials the flexibility to diversify their portfolios without the financial burden of a full property purchase, making real estate more accessible and less risky for younger investors. Fractional ownership is quickly becoming the go-to option for those who want to invest in real estate but aren’t ready to commit to traditional homebuying. It’s the perfect marriage of innovation and practicality—hallmarks of millennial thinking.
What’s next? The millennial effect on the future of real estate
Looking ahead, the influence of millennials on the real estate market is only set to grow. Projections suggest that by 2025, millennials will account for up to 80% of the residential real estate market, according to industry experts. This demographic dominance will continue to drive key trends like digitalization, sustainability, and alternative investment models, reshaping the future of the sector.
Government initiatives like Pradhan Mantri Awas Yojana (PMAY), which offer financial incentives and tax breaks for first-time homebuyers, are further encouraging millennial participation. With policies designed to ease the homebuying process, millennials are likely to have an even greater impact on the market, ensuring that real estate evolves to match their expectations.
The Indian real estate sector stands at a critical juncture, with millennials driving the next wave of growth. Their demand for digital solutions, sustainable living, and flexible ownership models presents both significant opportunities and challenges for industry players. To remain competitive, developers, brokers, and financial institutions must align their strategies with the evolving expectations of millennial homebuyers.
As we move into the future, the real estate market will increasingly be defined by how well it caters to the unique needs of millennials. After all, this is a generation that doesn’t just want to own property—they want to redefine it.
-The author is founder & chairman, Signature Global India and chairman, ASSOCHAM- National Council on Real Estate, Housing and Urban Development
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