Indians love buying property as it gives them a sense of financial safety and security. It is also an asset they can rely in their tough times. A house essentially is bought for self-use, but some buy multiple pieces of property for rental income as well.
As per the BankBazaar Aspiration Index 2023, buying and having own house continues to be a key financial goal for many people in India. In fact, this is ranked third among the top 5 financial goals of Indians.
Mental health with 89.1 ranked as the most important and most chosen goal. Children’s education (88.9) continues to be a top priority in the top 2, so does home ownership at the third place with (88.2). The report studies salaried men and women between the ages of 22 and 45 across 17 goals under five broad aspirations: Health, Wealth, Fame, Relationship, and Personal Growth.
The report further highlights that high inflation and soaring costs of capital continue to hamper aspirations of Indians. For a significantly higher number of people, high cost of living is the biggest roadblock (48%) combined with limited savings (44%) and a tax regime not adjusted for inflation (30%). Coupled with the steep increase in the cost of credit, people are increasingly turning fiscally conservative this year.
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82% have seen high borrowing costs impact their aspirations. The percentage of people taking loans to build assets such as a house, vehicles, or even for higher education and home improvement has fallen by 2-3 percentage points. Nevertheless, optimism still persists as majority people (56%) choose to defer their aspirations over downsizing them or writing them off altogether.
Adhil Shetty, CEO, BankBazaar, says, “The global economy is gripped by wintry conditions. High inflation and soaring costs of capital have been a persistent pain since last year. Mental health remains a major concern as stressors mount. In the larger scheme of things, India remains a bright spot in the global economy. This is our decade. We will overcome short-term challenges. But for now, the story we have is of a few demographics struggling more than the others. After the winter comes spring and there’s much to look forward to in 2024.”
When it comes to home ownership and other aspirations, women have higher aspirations. As per the study, the top aspirations for women centered around mental health (90), children’s wellbeing (89), and home ownership (89). Retirement planning (84.5), hobbies (83.5), and lavish weddings (82.5) were the least important.
“The percentage of women, especially older women, in the study has always been a positive factor in determining the mood of the nation. This drive of women to contribute and excel in all spheres has huge implications on how India grows as a nation, and I expect to see women’s workforce participation improve and be a powerful driver in India’s journey to becoming a $5-trillion economy,” concludes Shetty.
Homeownership continues to rank up there among the top three goals. However, the rising cost properties and interest rate continue to influence the homebuyers’ sentiments. One of the most satisfying factors for home ownership is seeing your property appreciate in value even when you are never going to sell it. Buying a house is getting costlier but the charm for this goal, it seems, will continue.