<p>In this paper, we examine the role of digital payments on household home-buying sentiments. Using a large panel dataset from the Consumer Pyramids Household Survey (CPHS) in India, combined with digital payments data from the Reserve Bank of India from January 2020 to June 2023, we find that increased digital payment adoption is associated with greater optimism in the housing market. Our heterogeneity analysis also indicates that this effect is more pronounced among urban households, low-income groups, and self-employed individuals. We further document how digital payments shape home-buying sentiment through three key channels: easing credit constraints, enhancing confidence in personal economic conditions, and improving perceptions of the broader economic environment. Our findings provide robust evidence of the forward-looking role of digital payments in strengthening housing sentiment and, by extension, the overall economy. We argue for further policy impetus by the government and the regulator towards digitalization, especially in rural areas. Improvements in regulatory tools can further encourage digital payments by banks and fintech companies can gradually bridge the gap between rural and urban areas. Such policy initiatives can foster healthy growth in housing market sentiment, home-buying decisions, and, ultimately, the country's economic growth and development.</p>