Millennials powering demand for 2 BHK and micro apartments this festive season
A survey that takes stock of the property market sentiment during the festive season compiled by 360 Realtors, India’s leading real estate consulting company, indicates a marked preference for smaller, affordable units like 2BHK and micro apartments. This trend is visible across major metros – Gurugram, Noida, Mumbai, Pune and Bangalore and is driven by the participation of millennials between 25 to 35 years of age, who account for 36% of prospective home buyers today. According to the survey, more than 60% of the homebuyers are attracted by the festive offers and schemes. Some key findings of the survey are:
65% of prospective buyers planning their property purchase between September and November
Buyer sweet spot lies between INR 40 to 80 lakh
30% buyers are also looking for smaller units priced below INR 40 lakhs
Emerging millennial buyers
While the 35 to 45-year-old age group is the obvious front runner when it comes to prospective buyers, interestingly a growing class of buyers aged below 35 years is deepening their foothold in real estate purchases. Buoyed by attractive home loan rates and offers, millennials are expressing interest in buying 2BHK, 1BHK and studio apartments as they fall into their budget owing to festive offers. Around 75% of these purchases are for personal usage while the remaining 25% are investment driven. Another interesting segment is of customers below 25 years of age which constitute 7% of prospective buyers and have shown an appetite for studio, 1 BHK and small 2 BHK apartments.
2 BHK units are driving the demand
The first choice of prospective buyers across all age groups are 2 BHK units. 2BHK units are becoming increasingly popular among nuclear families and millennial buyers as they suffice their needs and are moderately priced with several developers coming up with smaller carpet area options (900 to 1350 sq. ft) in the category. Demand for 1BHK and studio apartments is also on the rise.
Housing Units Split
Buyer sweet spot lies between INR 40 to 80 lakhs
In terms of the budget, units priced between INR 40 to 80 Lakhs are most preferred, followed by micro-apartments and smaller 1 BHK which are generally priced between INR 30 to 40 Lakhs. Going forward, buyers are expected to continue to gravitate towards smaller units.
According to the survey, around 65% of the buyers plan their property purchases between the festive months of September to November due to attractive offers and schemes. Developers offer a range of financial schemes such as discounts in payment plans, rebates in parking charges etc. Likewise, developers also float a lot of non-financial incentives such as free gift vouchers, mobile phones, cars, foreign trips etc. Some developers even go the extra mile and offer free fittings such as split type AC, wooden furnishing, modular kitchens etc for bookings done during the festive season.
According to Ankit Kansal, Founder and MD, 360 Realtors, “The last 3 to 5 years have seen a decline in the millennials’ interest in home buying owing to the fluctuating real estate market. However, attractive payment plans and affordable housing units coupled with reforms like RERA are driving young buyers to the market in a big way. This is a great sign for Indian real estate. Interestingly, the upbeat market sentiment is also drawing the attention of investors in sizeable volume. Roughly, one-fourth of the market is currently driven by investors.”
360 Realtors’ Business Intelligence conducted surveys with 300 prospective homebuyers from major metro cities like Gurgram, Noida, Mumbai, Pune and Bangalore in September, 2018 to prelude the market demand ahead of the festival season.
360 Realtors is India’s leading real estate consulting company that provides end-to-end transaction consulting services to property buyers. Started in 2014, the company has enabled over 10,000 residential purchases. Headquartered in Gurgaon, 360 Realtors has 40+ offices across India. The company also helps NRIs buy real estate in India and has 9 offices across Dubai, Qatar, Bahrain, Kuwait, Oman, Saudi Arabia and Singapore. It handholds customers through the entire home buying process, right from shortlisting, site visit, finalization, home loans/legal services and final purchase. The company has been founded by Ankit Kansal, a serial entrepreneur who has built successful global businesses in home decor, furnishing and home fragrances.