Sustainability has become a defining factor in the housing market, with younger generations demanding homes reflect their environmental values -- pushing developers to move beyond green labels and deliver truly responsible, future-proof residential solutions.
Rising environmental awareness is transforming buyer expectations, prompting developers to adopt authentic, forward-looking sustainability practices that span the entire development process -- not just surface-level features or end-stage certifications.
Residential projects that integrate sustainable living concepts such as energy-saving systems, green space and water conservation are increasingly shaping purchasing decisions.
These considerations are especially pronounced among Gen Z, who are emerging as influential homebuyers.
ESG-ORIENTED GENERATION
SCB Economic Intelligence Center (EIC) identified Gen Z as placing a high value on housing aligned with environmental, social and governance (ESG) principles, showing greater interest than any previous generation.
ESG criteria include responsible construction methods, eco-friendly materials, reduced pollution, and integration with the community. These values align with Gen Z's growing preference for sustainable and ethically responsible products and lifestyles.
Nearly 99% of Gen Z respondents in SCB EIC's 2024 housing survey said they are interested in ESG-oriented residential projects. For other age groups, the rate ranged from 90% to 94%, which is still significant.
Some 68% of Gen Z buyers also indicated they are willing to pay more for ESG-aligned homes, compared with 61% of baby boomers, 58% of Gen Y and 55% of Gen X, according to the survey.
This willingness to invest more reflects a long-term value mindset. For Gen Z, buying a home is not only about ownership, but also aligning lifestyle choices with their environmental and ethical values.
SCB EIC found more than 90% of consumers value building materials that save energy, cool indoor spaces and support the health of both residents and pets.
In addition, 76% showed interest in eco-friendly materials, such as those made from recycled content or low-emission processes, with most willing to pay up to 5% more for them.
A 2022 survey in Singapore by asset management firm Amundi and The Business Times supports these trends, finding strong ESG engagement among Gen Z and millennials in investment decisions -- not only as consumers but as active investors.
In the survey, 82% of Gen Z and 63% of millennials invested in ESG-focused funds or assets. Only 41% of Gen X and baby boomers did the same, illustrating the generational divide in ESG adoption.
This data underscores that younger generations view ESG not as a trend, but as a necessity. It affects how they live, buy and invest, offering developers a clear roadmap for future-proofing their projects.
NET-ZERO CARBON HOME
Property research firm and consultancy Terra Media and Consulting found similar results in Thailand. A November 2024 survey identified net-zero carbon homes as one of the top three types of innovative homes preferred by prospective buyers.
Key features respondents desired in a net-zero carbon home included solar rooftops, eco-friendly materials, electric vehicle (EV) chargers, flood-resilient layouts, and food waste composting systems.
Each generation valued these elements differently. Gen Z was the only group to express interest in all five features, demonstrating their comprehensive and deep commitment to environmental sustainability.
Baby boomers preferred every feature except the EV charger. Gen Y prioritised solar rooftops, EV chargers and food waste composters. Gen X opted for solar power, EV chargers and flood-resilient planning.
"These findings indicate sustainable design is not one size fits all. Developers must consider the unique green priorities of different age groups while maintaining high environmental standards across the board," said Sumitra Wongpakdee, managing director of Terra.
SCB EIC suggested developers realign their business strategies with ESG frameworks, focusing on environmental considerations to ensure they remain relevant as consumer demands evolve.
Committing to ESG starts with the planning phase, including responsible land use, climate-conscious design and low-impact construction, noted SCB EIC. Sustainability must be embedded early, not added as an afterthought.
Operational sustainability must also be central, as developers should prioritise energy-efficient systems, waste reduction, smart water management, and community-driven green planning as part of their long-term development model, said the centre.
Doing so not only meets regulatory expectations, but also builds trust with buyers. Transparency, credible certifications and evidence-based sustainability reporting are key to building consumer confidence in green developments, noted SCB EIC.
COMPETITIVE EDGE
Eco-conscious buyers expect more than rooftop solar panels. They demand homes that are part of a sustainable ecosystem, equipped with smart, resilient and regenerative technologies that serve both people and the planet, according to the centre.
Sustainability provides a competitive edge, and developers that embrace ESG are better positioned to access green financing, government incentives, and more likely to future-proof their assets against tightening regulations.
Investing in sustainable design enhances brand equity and long-term profitability, while reducing operating costs for buyers and creating communities that are healthier, more resilient, and environmentally harmonious.
Developers must also rethink marketing. Messaging should clearly communicate the tangible benefits of sustainable features, not merely environmental value, but the health, comfort and cost savings for homeowners, noted SCB EIC.
Gen Z and millennial homebuyers are redefining what makes a home desirable: climate resilience and ethical design. Green housing is no longer a luxury or niche -- it's a fundamental expectation. To remain competitive, developers must offer homes that reflect the values and of these buyers.
The shift to sustainable housing is irreversible, and developers who embrace this change now will lead the market, create lasting impact, and help build a better, greener world for all, said the centre.