Generation Z investors have access to far more investment options compared to previous generations. In addition to stocks, mutual funds, and real estate, they can now utilize REITs, Exchange Traded Funds (ETFs), and digital investment platforms. These growing opportunities have changed the traditional role of real estate in wealth creation. Young investors are now comparing real estate with other investment options based on criteria such as yield, liquidity, and flexibility.
According to Gaurav Mavi, co-founder of BOP.in, real estate can maintain its role in a diversified portfolio, but young investors view property differently than previous generations; for them, a home or real estate is no longer a mandatory first investment. Instead, they evaluate the advantages and limitations of real estate, placing it alongside other asset classes.
These changes occur against the backdrop of sustained demand in the Indian housing market. According to Knight Frank estimates, over 348 thousand homes were sold in 2025 across eight major residential markets in India. Furthermore, the share of premium housing has also increased, indicating continued demand for high-end properties.
According to data provided by Gaurav Mavi, property prices in several Delhi-NCR micro-markets have seen an annual growth of approximately 10 percent. The rapid development of infrastructure in the region also influences decisions regarding investment in both residential and commercial real estate.
For Generation Z investors, liquidity has become a critical aspect. The need for frequent city changes due to career shifts, entrepreneurship, or work/business forces young investors to think carefully before locking up large sums in physical real estate early in their careers.
Investing in real estate requires significant initial capital, and selling it quickly for cash is not always easy. In contrast, investing in and withdrawing funds from stocks, mutual funds, and other financial products can be relatively straightforward.
The expansion of Fractional Ownership and listed real estate products has opened new avenues for real estate investment. In March 2024, SEBI introduced the SM REIT structure, which allows investors to invest in real estate without purchasing the entire property.
Gaurav Mavi, citing ICRA data, noted that assets worth about 500 billion rupees are managed through fractional ownership platforms in India, and fully built office buildings valued between 670 and 710 billion rupees can be monetized through SM REITs.
Physical real estate possesses certain characteristics not directly present in financial assets, including rental income, ownership of a tangible asset, and the ability to invest in a large property using leverage. However, there are also challenges, such as transaction costs, maintenance expenses, debt risk, and low liquidity. Therefore, it is important for young investors to consider not only potential returns but also associated investment costs and risks.
Infrastructure-driven development also influences real estate investment decisions. Residential and commercial activity is growing around the Dwarka Expressway, Yamuna Expressway, Greater Noida, and Noida International Airport. Thanks to improved connectivity and expanded economic infrastructure, real estate activity in these areas is also increasing.
A growing trend among Generation Z investors is not choosing between real estate and financial assets, but rather building a portfolio by combining various asset classes. Real estate can be part of this portfolio, but its significance depends on factors such as investor income, investment horizon, need for liquidity, risk tolerance, and the quality and location of the property.
Overall, the method of wealth creation is becoming portfolio-oriented, as physical real estate, listed REITs, stocks, and other financial instruments can satisfy diverse investment goals.