A recent report on real estate by UK based firm Knight Frank, issued under the title Banking on Bricks has pointed out that most of the homebuyers in India would prefer borrowing home loan to any other means of financing home purchase. Based on results obtained from a total of 1,629 urban home dwellers, the study found out that 79% of the respondents find home loans very instrumental in providing sufficient funds for them to purchase property. This trend confirms the increasing temptation of home seekers towards the financial institutions, affordability desirability, the need for low interest rates, longer term of loan repayment and faster processing of applications.
The application also had to do with other aspects of ownership. Owning a home is appealing to approximately 80% of the people surveyed, while 19% would rather live in a rented apartment. This enduring dream of home ownership is heavily influenced by the social and economic aspects attached to owning property because they are seen as the ultimate achievement as well as a source of security. Shishir Baijal, who is the Chairman and Managing Director of Knight Frank India, said that for most Indians, owning a house is still one of the priorities and there is more demand for high-end houses especially in the cities.
The research also conducted an analysis of reasons for home purchases which showed differences among generations in purchasing tendencies. Upwards of 77% of the respondents from those age groups caused an upsurge in demand for better houses, the figures being 39% for interference, 36% for Millennials. Baby Boomers, in contrast, seem to have a greater interest in investments (29%) and in planning for retirement (15%).
Overall, 37% of the respondents want to move up to a better house which is also a tendency that is currently extending from the main cities to Tier 1 areas. The rest of the respondents, presented as the following pie chart, were first-time home buyers (32%), investors (25%), and those who buy houses for retirement or for holidays (7%).
The respondents identified location as the most preferred criterion for home purchase as half (50%) of them put it as the utmost priority. Other important aspects are property size and design, cost, reputation of contractor, distance to work, facilities available and means to finance the home. Worth noting is the fact that size and price were almost the same in terms of importance, with each attracting 45% of survey participants, which suggests that home buyers are looking for value for pricing without compromising on standards.
The preference for apartment living continues to be the most preferred option as 52% of respondents preferred living in apartments, followed by studio apartments at 19%, independent houses at 17%. However gated communities and land preference were considerably low, with only 87% and 5% of respondents respectively selecting these options.
The survey also points out that amenities are becoming even more important for residents since 32% of respondents included above integrated facilities like gym, park and co-work areas etc. in the decision-making process. In addition, 29% of the respondents considered the payment plans available, and 22% the expected resale value of the property in the future, indicating the role played by affordability as well as investment viable tenure.
