by THO
As many as 80% of people who aspire to own property prefer to take a home loan for it. Besides location (50%), size (45%), affordability (45%), availability of financing options (29%) and future resale value (22%) are factors that dictate the home buying decision making process, a report by Knight Frank India has said.
In terms of financing, about 79% of respondents indicated home loans as their preferred mode for purchasing a home, according to the Knight Frank report – Banking on Bricks, a survey of 1,629 Indian urban homebuyers.
As many as 52% home buyers prefer apartments, followed by studio apartments at 19%, and independent houses or villas at 17%. Notably, gated communities and plots of land are less popular, chosen by only 7% and 5% of respondents, respectively, it observed.
Factors that determine home buying decision
Location stands out as a priority and is the determining factor for 50% of respondents, affirming its timeless importance in real estate. However, the near-equal emphasis is also provided on the property size and layout (45%), price and affordability (45%), which suggests that homebuyers are equally focused on securing value for their money while looking for spaces that meet their lifestyle needs.
Builder’s reputation (35%) and proximity to the workplace (33%) play an important role, reflecting a strong demand for reliability and convenience, key factors that enhance buyer confidence in their long-term investment.
Moreover, with amenities (32%) becoming more significant, buyers are not just purchasing homes, but are opting for enhanced living experiences, seeking integrated facilities like gyms, parks, or co-working spaces, it said.
On the financial front, financing options (29%) and future resale value (22%) highlights that affordability and long-term investment potential remain crucial factors in the decision process, particularly as more buyers gravitate towards high-end homes, the report showed.
Home ownership preferences across age groups
Overall, 80% of respondents expressed a preference for owning a home with only 19% opting for renting and a mere 1% remaining uncertain. This sentiment is consistent across generations: 79% of Baby Boomers, 80% of Gen X, and 82% of millennials favour homeownership, while Gen Z shows a notable difference, with only 71% preferring to own, and a high 27% leaning towards renting, it said.
Reasons for purchasing a home – Investment versus end-use
Baby boomers favour investments but millennials prefer to upgrade their property. The reasons for purchasing a home show distinct generational difference.
Overall, 37% of respondents are upgrading to a better home reflecting a growing shift towards mid-range and luxury housing which was traditionally concentrated in select cities but is now expanding to Tier 1 cities in India. The remaining 32% are first-time homebuyers for end-use, 25% are investing, and 7% cite other reasons, such as retirement or acquiring a second home or vacation home.
Others includes reasons to purchase for retirement or as a second home/vacation home, the report showed.
“India’s real estate sector is not only pivotal to our economic growth, contributing significantly to GDP and employment, but also reflects evolving buyer preferences and financial support systems. Our latest survey highlights this continued preference for homeownership, with 80% of respondents aspiring to own homes and a growing trend toward premium properties, particularly in urban areas,” said Shishir Baijal, Chairman and Managing Director, Knight Frank India.
“As the BFSI sector facilitates this growth—offering home loans, investment avenues, and risk management tools—combined with emerging technologies and infrastructure advancements, we anticipate a resilient real estate landscape that aligns with India’s broader development goals,” he said.
Also Read: Almost 50% home buyers prefer 3BHK homes; 75% want balconies: FICCI-Anarock survey
