A study by Halifax has found that Generation Z, the next crop of first-time buyers, has some unrealistic ideas about the property market. For a start, they think it’s going to be easy, so some may be in for a shock!
Drilling down further, Halifax found out some surprising misconceptions.
Gen Z thinks there’s unlimited funds
Around 20% of 11 to 14-year-olds think that they’ll be able to borrow as much money as they want to fund their purchase. A third also expect their parents to buy the house for them!
As they get older, members of Gen Z get more realistic and 21% of them start to think about the government schemes like Help to Buy and how they can help.
Gen Z isn’t discouraged by horror stories of huge deposits and gazumping, with 59% of 18 to 21-year-olds believing it to be very important to own their own home and 25% expecting to do this by 25.
Unrealistic views of house prices are responsible for this optimism, though, with 20% of the 11 to 21-year-olds thinking that a London property will cost between £50,000 and £200,000. The actual first-time buyer average in the capital is £420,000. First-timers also tend to be a bit older than 25, too – 32 in London and 30 in the regions.
Pessimistic or realistic?
Sadly, almost a quarter of 15 to 17-year-olds believe only the rich can own their own homes; this same group expects to save for 20 years before accumulating enough for a deposit. Oddly, 15% of the 18 to 21-year-old group believes that it takes more than a year to buy a house.
Almost a quarter (23%) of men aged 18 to 21 thinks that £5,000 to £10,000 is enough for a deposit, whereas only 5% of women in this group were confident about it. The actual first-timer deposit in the UK is just over £32,000.
A fifth of 18 to 21-year-olds are waiting for an inheritance to pay off their mortgages. Men are more optimistic, with 31% expecting a windfall compared to 18% of women.
Generation Z, unsurprisingly, will turn to the internet to buy a property, with 36% seeing it as their first port-of-call.
Some surprising findings
Encouragingly, more members of Gen Z (32%) see meeting their new neighbours as more important than having wi-fi (27%). The 18 to 21-year-olds also said they’d prioritise buying a new sofa over throwing a housewarming party.
Most of the 11 to 14-year-olds get the concept of mortgages, but one in ten of the 18 to 21-year-olds thought that stamp duty was money used to buy postage stamps!« Back to Latest News