Arya News - Young Indians are entering the housing market earlier than previous generations, with Gen Z emerging as the fastest-growing age group among home loan borrowers, according to data from Kotak Mahindra Bank.
NEW DELHI – Young Indians are entering the housing market earlier than previous generations, with Gen Z emerging as the fastest-growing age group among home loan borrowers, according to data from Kotak Mahindra Bank.
The number of home loan borrowers in the 25-30 age group rose 86% between FY24 and FY26, increasing from 1,234 to 2,290, the bank’s data showed. Over the same period, their share of Kotak’s individual home loan borrowers increased from 6% to 9%.
This represents a 50% increase in their contribution to the bank’s home loan borrower base, making the cohort the fastest-growing younger segment in Kotak’s housing loan portfolio.
The trend marks a shift from the earlier expectation that Gen Z would prefer renting for longer, delay major financial commitments and prioritise flexibility over homeownership.
The data indicates that homeownership is becoming an earlier financial milestone for a section of India’s younger workforce.
In comparison, the number of home loan borrowers aged 30-45 years increased 26% between FY24 and FY26, significantly slower than the growth recorded among borrowers aged 25-30.
Several factors could be contributing to the shift. Higher educational attainment, earlier career progression and rising incomes have given some young professionals greater financial capacity to consider buying a home at a relatively young age.
For some households, home purchases are also becoming a joint financial decision. Dual-income couples can combine their earnings and borrowing capacity, potentially allowing them to purchase property earlier than single-income households.
The COVID-19 pandemic also appears to have influenced how younger Indians view their homes.
With people spending extended periods indoors during the pandemic, factors such as larger living spaces, privacy, natural light, construction quality and access to community amenities gained greater importance.
Homes increasingly became multipurpose spaces where people could work, study, spend leisure time and plan for the future. This change in priorities may have strengthened the preference among some younger households for owning rather than renting a property.
The rise in younger borrowers suggests that India’s housing market is seeing a gradual change in its demographic profile.
While older age groups continue to form a significant part of the home loan market, the rapid increase in borrowers aged 25-30 indicates that a growing number of young Indians are willing to take on long-term housing commitments earlier in their careers.
The Kotak data, therefore, points to a broader shift in the timing of homeownership, with employment, income growth, changing lifestyle preferences and evolving family finances influencing when Indians decide to buy their first home.