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Fractional real estate attracts GenZ, NRIs and retail investors via digital platforms, but experts urge caution on risks, transparency and realistic returns.
GenZ Drives Fractional Real Estate Wave, Experts Urge Caution on Fair Value
Fractional real estate is drawing strong interest from young investors, NRIs and those looking for premium properties without heavy upfront costs. Fractional ownership means that a buyer doesn’t purchase the entire premium property like villa, commercial building or holiday home but a share of that property like a stock in a business. There’s a rise in fractional property investment, especially among GenZ investors, thanks to digital platforms and small-ticket real estate investing. Several platforms have popped up in recent times, offering a window of investment to retail investors.
But experts say this new investment avenue in real estate still needs clearer rules, better transparency and more realistic expectations.
What Is Fractional Real Estate Investment?
Fractional ownership sits between direct property buying and REITs. Investors get a share in rental income and the asset’s appreciation, without bearing full ownership costs.
Karan Shetty, Co-Founder of Claravest Technologies, explains the differences more sharply: direct buying gives full control and full profit but demands high capital; REITs offer high liquidity but are volatile because they react to equity markets; fractional ownership gives access to premium assets through an SPV structure, with platforms handling due diligence, maintenance and eventual sale. He notes that the concept is popular globally and is “slowly picking up pace in India,” estimating strong growth by 2030.
Aditya Kushwaha, CEO and Director at Axis Ecorp, says fractional ownership is becoming mainstream as younger buyers prefer tangible assets aligned with their lifestyle. He highlights that investors “get direct equity in a specific asset” unlike REITs, which offer exposure to a pooled portfolio. He adds that transparency has improved, with “structured documentation and audited updates,” and secondary marketplaces are making exits easier than before.
Experts Caution On FMV, Timing and Risky Exit
However, Shetty cautions that investors must do their own checks. Key questions include whether the property is bought at a fair value, whether return projections are realistic, and what documents and rights an investor actually receives.
MicroMitti founder and CEO Manoj Dhanotiya argues that fractional real estate and REITs largely benefit developers and institutional players. He says these models “do not give real upside” to retail investors and often leave them dependent on platforms for exit. According to him, many small investors “end up trapped with no surety of capital exit.”
As interest rises, experts agree on one thing: fractional real estate can be a useful tool, but only when investors understand valuations, timelines and risks clearly.
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst…Read More
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst… Read More
November 20, 2025, 15:10 IST
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