Not the Gen Z, nor the older generation, it is the millennials which are favouring real estate for investments, a recent survey has indicated. Amongst the various generations, millennials are the ones which are driving the demand of real-estate in India.
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52% Millennials Prefer Real Estate Investment
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52% of millennials choose real estate as the best asset class, while 30% of Generation X and 11% of Generation Z prefer real estate as the best asset class, revealed a survey by Confederation of Indian Industry (CII) and real estate firm Anarock.
Over 45% property seekers in NCR are looking to buy 3-BHK homes in the near future. As far as the end-user – investor ratio is concerned, it stands at 71:29 and of all surveyed end-users, over 77% are millennials, as mentioned in ET report.
However, despite the presence of stocks, mutual funds, gold, etc, is it worth investing in real estate and make it a part of your investment portfolio? Click here to know more.
Rising Home Loan Rates To Affect Demand
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96% Indians believe that higher home loan rates will affect demand for houses, as per the survey. Another recent report by credit bureau CIBIL mentioned a de-growth of approximately 1 per cent year-on-year (YoY) decline in demand.
This trend may signal that prevailing conditions like higher inflation and rising interest rates have impacted consumer sentiment, prompting a conservative approach in taking high ticket home loans. At present, rising home loan rates due to RBI’s six back to back repo rate hikes are even pushing loan tenures beyond the borrower’s retirement years!
Now it remains to be seen whether the recent pause in repo rate hike by RBI this month can act as a boost for housing sector and generate an uptick in home loan demands too.
How To Invest In Real Estate Without Purchasing Property
Yes you read that right, You can invest in real estate without going through the hustle of finding and actually buying the ‘right’ property? Sounds crazy, right? After all, real estate is all about owning property.
This is where REITs come in! This relatively new but promising investment vehicle has been gradually transforming the real estate sector. REITs are companies that own, operate or finance income-producing real estate. They were created with the main purpose of channelising the funds that could otherwise be invested in operational functions or ownership of the real estate, into further income generation for the investors, thus making them an investment vehicle.
Just like mutual funds invest your money into securities like equity, debt, money market instruments etc., REITs invest in real estate and are listed on stock exchanges.
Simply put, when you invest and buy a unit of REIT, it represents partial ownership of that real estate asset held by the trust, thus entitling you, the unit-holder, to a share of the income generated by the REIT.
Click here to know more abut REITs.
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