Millennial women: Riding high on home ownership

There’s a famous saying - the hand that rocks the cradle rules the world. This is so apt today, as women are excelling across sectors and increasingly making their mark in a male-dominated world. The 21st-century millennial woman is progressive and increasingly financially independent. This has led to a distinct shift in her investment preferences - where gold and fixed deposits were the primary choices for Indian women, real estate now rides high in her investment portfolio.

In fact, in Anarock’s consumer sentiment survey, nearly 20% of participants were women. Among the many highlights of this survey - nearly 42% women respondents preferred real estate as an investment asset class, followed by 30% for FDs and a mere 17% for gold. This is hardly surprising - a woman’s relationship with her home is unique; and while any other ‘relationship status’ may change in today’s rapidly-evolving socio-economic scenario, owning a home in her name gives her the ultimate security in a changing world.

Anarock’s survey also reveals that:

1. Nearly 60% of women home seekers prefer a property within the budget-range of Rs 80 lakh.
2. 52% will opt for ready-to-move-in homes.
3. Nearly 80% prefer large-size units within both 2 and 3 BHK options (between 1,000-1,250 sq. feet for 2 BHKs and 1,250-2,000 sq feet for 3 BHK). Clearly, contrary to the increasing conservative preference for compact homes, the Indian millennial woman does not want to compromise on property size.
4. These trends vouchsafe that women are emerging as a critical homebuyer segment in India – not just a ‘niche’ segment and that marketers and developers must re-strategise their business approach to include them as a major target audience.

Today’s women share the same priorities that men do – they are in complete control of their homes, and that including owning them. Property marketers must factor in this vitally important change in their customer demographics. The rapid increase in women homebuyers across the country has also prompted the Government to give them added benefits. To empower women of the low-income segment as per the Housing for All by 2022 mission, the Government has now made it mandatory for them to be either co-owners or sole owners of affordable homes.

Property purchase – Advantage women

There are also many benefits that women can avail in India by buying and registering property in her name. Lower stamp duty charges, low home loan interest rates and tax deductions are some of the benefits they are entitled to while buying a property.

While stamp duty charges are lower if property registration is executed in the name of a woman, these charges vary from state to state. The exemption for women varies between 1-2% across different states. In some cases, it might even vary within a particular state, based on the classification of regions as ‘urban’ and ‘rural’.

For instance, Delhi, UP, Rajasthan, Punjab and Haryana offer relaxation in stamp duty for women buyers. Punjab reduced the previous stamp duty charges from 9% to 6% in 2017, albeit for a limited period. It maintained that from April 1 2019, urban areas will again invoke a stamp duty charge of 9%, and 6% will continue in rural areas. The stamp duty rates in Maharashtra, recently revised to 6% from the previous 5%, are uniform for both men and women. However, the other states where stamp duty rates are lower for women include Jharkhand (Only Re 1), Delhi, Haryana rural, Rajasthan, Punjab (4%), Karnataka (5.6%) and UP (Rebate of Rs 10,000 on overall charges).

Additionally, many banks such as SBI, ICICI, HDFC, etc. offer discounted home loan rates to women as compared to men. This variation varies from bank to bank and goes up to nearly 1%.

Further, to avail tax benefits, a woman can become joint owner of a property with her husband and, if she has a separate source of income, both can claim tax deductions individually. The favourable lower stamp duty rate for women can and does, to some extent, influence decisions on whose name property is registered under.

This can be a geographically-determined dynamic, as different parts of India have different cultural viewpoints on this. For instance, matriarchal societies in South India, Goa and the North East do give women the upper hand in many matters, including in property ownership. Other parts of the country are more male-dominated and a variation in stamp duty rates may not skew property purchase decisions in favour of women.

In the past, it has been observed that property registration is done in the name of a woman of the family to reap the benefits of lower stamp duty, but shortly thereafter, the property is re-registered in the name of the male member. For this reason, some states have barred re-registration of property in the name of a male before at least one year.

The bigger difference of this provision would lie in the fact that it is an incentive for women to purchase homes independently, regardless of marital status, and for properties to be registered in the name of daughters.

(The writer is Chairman, Anarock Property Consultants)