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Gen Z opts for renting over buying amid rising housing costs: Reports
Renting has become an alternative option for those who prefer to avoid long commuting times from the outskirts of Jakarta, given that homeownership in the city center is unaffordable.
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This aerial picture shows residential areas surrounding the city center in Jakarta on Dec. 2, 2021. (AFP/Bay Ismoyo )
A
s affordable housing becomes less accessible, Indonesians born between 1997 and 2012, known as Gen Z, are more inclined to rent rather than buy a property, several reports have found.
Two out of three Gen Z respondents are pessimistic about the prospect of buying a house within the next three years, according to a survey by Inventure in September. Around 80 percent of them cited surging house prices as the primary reason.
Contributing factors include insufficient income, unstable employment and a preference for experience-based consumption such as concerts, holidays and gadgets. Others especially pointed to difficulties in obtaining a mortgage and existing debt burdens that prevented them from taking out housing loans.
The survey also shows 38 percent favored rent-to-own arrangements, while 34 percent preferred short-term rental agreements.
Similarly, according to data from Jakpat in 2023, over 36 percent of Gen Z respondents were reluctant to buy a property and opted for renting.
Among those, 36 percent said they were not financially ready to buy property, while 22 percent considered renting more affordable, followed by 18 percent who preferred to rent due to a strategic location.
Despite their reluctance, the report also noted that developers often market their properties to Gen Z as potential buyers, indicating that although Gen Z is yet to be financially capable of buying a property they continue to aspire to become homeowners.
