• Millennials are renting more. Yet, the reason might not be what you think. It is not due to a lack of funds that they favor renting over purchasing a home. There are numerous other factors that drive millennials to prefer renting. In this article, we will explore the reasons for the popularity of this renting trend over home buying among millennials.

Why Renting Can Beat Buying for Millennials

• In recent years, millennials have increasingly chosen to rent rather than buy homes. This might initially appear to be a choice driven by financial difficulties. However, the reality behind this trend is quite the reverse. Here are a few reasons why renting can be preferable to buying for millennials.

1. It’s Budget Friendly
   
   With many students taking out loans, the level of debt has risen significantly. Most millennials carry student loans from various banks, resulting in a substantial debt burden. To minimize further debt, they opt for renting instead of home buying. Renting demands significantly less capital than purchasing a home or even a plot of land.
   When renting a home, the primary costs include advance payments, security deposits, utility bills, monthly rent, and maintenance fees. Conversely, buying a home requires a substantial capital investment. Numerous individuals also pursue home loans to finance a house purchase. Choosing a home loan will only serve to compound their debt.
   
2. Settling Down Later in Life
   
   It has been noted that millennials often marry later and establish families much later compared to previous generations. They are 10% to 20% less likely to marry in their 20s when compared to their parents or relatives. Thus, the impetus to buy a home diminishes. Furthermore, millennials are less inclined to have children at this phase of their lives. Aligning with their goal-oriented lifestyle, renting can represent a more practical and affordable option.
   It would be wiser for millennials to consider buying a home once they are settled in life with a family, as a permanent residence becomes a necessity rather than just a luxury. Consequently, many millennials avoid purchasing homes because it would only incur additional expenses and complicate the process of relocating to different cities or countries
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3. Shift Bases Often
   
   Prior to the pandemic, millennials frequently relocated for work. Besides career reasons, the travel habits of millennials led to moves across cities and countries on a regular basis. This is one reason millennials are deemed more mobile than other generations. Over the next decade, 73% of millennials intend to move, highlighting a more fluid lifestyle compared to older generations.
   With such regular travel, it can be more economical to rent instead of purchasing a house. It can also eliminate the complications associated with buying and selling a home. Additionally, this enables millennials to bypass the need to move their belongings like furniture and other treasured items to different locations.
   
4. Reduced Maintenance Responsibilities
   
   When you purchase a home, there is considerable responsibility that comes with it. For example, you would need to ensure that the property is kept in good condition, that repair requirements are addressed, etc. Furthermore, it is necessary to conduct regular maintenance inspections to guarantee that all facilities are properly maintained. This procedure can be time-intensive.

• By leasing a house, the maintenance is usually taken care of by the landlord. This diminishes the amount of stress for millennials. If these maintenance issues are ignored, it could result in significant financial strain later on as the costs associated with these damages would be substantial. With regular upkeep carried out by the landlord, these expenses can also be reduced.

Conclusion

• Millennials have begun renting homes instead of purchasing them for numerous reasons. Renting can be highly advantageous from a financial standpoint while also proving to be a more convenient choice. Moreover, it is advisable to consider home insurance in India as it can aid in covering expenses incurred from repairs and damages.

Disclaimer:

• The information above is for illustrative purposes only. For additional details, please consult policy wordings and prospectus before finalizing the sale.