Gen Z eye homeownership

Investment gains are emerging as a potential source for future home purchases

Property Pulse

The traditional sequence of first settling into a career, building savings and only later considering a home purchase is changing among younger investors. Gen Z is increasingly looking at homeownership as one of the longer-term goals for their investments, according to the Anarock Real Estate Homebuyer Survey. Despite rising property prices and elevated borrowing costs, the survey indicates that investment gains could become an important source of funding for future home purchases.

 Across generations, 45 per cent of respondents said they planned to use investment gains towards buying a home. Millennials showed the strongest preference, with 71 per cent saying they would use investment returns for a home purchase. Among Gen Z respondents, the corresponding figure was 49 per cent, followed by 44 per cent of Gen X and 21 per cent of Baby Boomers.

FROM INVESTMENTS TO A HOME

The findings suggest that younger investors are not necessarily viewing real estate only as an immediate consumption decision. For many, a home represents a longer-term asset that can provide both a place to live and a measure of financial security. Gen Z investors may currently be allocating money across different financial assets, but the survey indicates that nearly half see future investment gains as a potential route towards homeownership.

This points to a gradual shift in how younger households may plan for property purchases, particularly as their incomes and financial commitments evolve. The survey also highlights another priority among Gen Z: entrepreneurship. About 39 per cent of Gen Z respondents said they would use investment gains to start a business, compared with 21 per cent of Millennials. Across all generations, 25 per cent identified starting a business as a potential use of investment gains.

GOALS CHANGE WITH AGE

The intended use of investment gains varies significantly across generations. While 17 per cent of respondents overall said they would build an emergency fund and 11 per cent would allocate gains towards retirement planning, only 2 per cent identified vacations as their preferred use. The differences become more pronounced with age. Millennials, generally those born between 1981 and 1996, showed the highest inclination towards using investment gains for home purchases.

Gen X, generally those born between 1965 and 1980, also placed considerable emphasis on property, with 44 per cent identifying home purchase as a goal. For Baby Boomers, generally those born between 1946 and 1964, financial priorities increasingly shift towards emergency reserves and retirement security. Gen Z, generally classified as those born between 1997 and 2012, is now entering the workforce and gradually moving towards major financial decisions.

Its property preferences could therefore become more significant as the generation moves into higher earning and household-forming years. Proximity to workplaces, connectivity, digital infrastructure, flexible spaces and lifestyle amenities are likely to remain important considerations as younger buyers enter the market. The generation's preference for convenience and technology-enabled living could influence project design, location choices and amenities.

Homebuying on agenda

●        45 per cent of respondents plan to use investment gains for a home.

●        49 per cent of Gen Z respondents identified home purchase as a goal.

●        39 per cent of Gen Z respondents would use gains to start a business.

●        71 per cent of Millennials identified home purchase as a goal.