Buying a home in India is no longer just a long, paper-heavy journey handled at bank counters. If you are a young homebuyer today, chances are you are doing most of it online. In fact, Millennials and Gen Z make up nearly 90–95% of residential property purchases, and they are doing it in a very digital way, according to a report by BASIC Home Loan.
The report, titled ‘How Bharat Finances Its Housing Dreams’, is based on responses from over 7,400 existing and aspiring homebuyers, with strong participation from Tier 2 and Tier 3 cities. It paints a clear picture, i.e., young India is driving both homeownership and the shift towards online home loans.
DIGITAL HOME LOANS ARE BECOMING THE DEFAULT CHOICE
For many borrowers under 40, applying for a home loan online is no longer optional, it is the preferred way. Around 72% of borrowers in this age group choose digital applications, and nearly half of borrowers above 60 are also getting comfortable with online processes.
A big part of this shift is the growing use of DigiLocker, where almost 80% of home loan users are aged 35 or younger. Paperless documentation and faster approvals are making the process feel less stressful and more transparent.
Atul Monga, CEO and Co-Founder of BASIC Home Loan, says, “Millennials and Gen Z are at the heart of India’s housing story, and their preference for fast, transparent digital loan journeys is reshaping the ecosystem.”
TIER 2 AND TIER 3 CITIES TAKE THE LEAD
The report also reveals that smaller cities are becoming strong centres of homeownership growth. Tier 2 and Tier 3 markets are seeing rising participation, especially in the Rs 11–20 lakh middle-income segment, where loan penetration is about 74%.
Better internet connectivity, digital public infrastructure and rising financial awareness are helping bridge the gap between metros and non-metros. For many families outside big cities, formal housing finance is becoming easier to access than before.
Raj Vikash Verma, former Chairman and Managing Director of the National Housing Bank, says, “India’s housing finance ecosystem has become more diversified and consumer-centric. Strengthening inclusion in Tier-2 and Tier-3 markets, while improving transparency and trust, can make housing a powerful lever of social security, economic dignity and long-term national development.”
WHAT STILL WORRIES HOMEBUYERS
Despite the digital progress, several pain points remain. Around 76% of respondents say excessive documentation and mis-selling are major concerns. Lengthy procedures, unclear terms and hidden charges continue to affect trust, especially among older borrowers.
Affordability is another balancing act. Lower-income households usually try to keep EMIs within 25% of their monthly income, while higher-income families are comfortable stretching this to 25–40%. Metro borrowers are generally more open to longer tenures and higher EMI ratios than rural buyers.
Some people still hesitate to take the plunge into homeownership. Common reasons include preferring to rent, not feeling ready for a long financial commitment, struggling to save for a down payment, or fearing loan rejection.
In other words, India’s homebuying journey is becoming younger, faster and more digital. As online systems improve and access spreads beyond big cities, more people are finding it possible to dream of owning a home.
For today’s buyers, the challenge is to balance convenience with careful financial planning. If digital tools continue to simplify the process while improving transparency, India could move closer to making homeownership not just an aspiration, but a practical reality for millions.
