While young people may be the future of the housing market, they hold several amusing and slightly concerning preconceptions about the property sector.
10 per cent of young people between the ages of 18 and 21 were of the opinion that stamp duty pays for the cost of posting letters, an opinion in sharp contrast to the reality of stamp duty as a tax on house purchases.
Whilst slightly more excusable due to their young age, children between the ages of 11 and 14 are particularly optimistic about their investment property prospects. 20 per cent of kids in this age bracket believe that the amount of money they can borrow on a mortgage is unlimited. Also unlimited in the minds of this group is the ‘bank of mum and dad’; 33 per cent expect that their parents will cover the entire cost of their future home.
This misconception and naive optimism pervades in later life, with a quarter of those between the ages of 18 and 21 expecting to be homeowners by the time that they are 25. This is far younger than the actual average age of a UK first-time buyer, which currently stands at 30 or 32 for those investing in London.
However, this optimism simply reflects the fact that home ownership remains a key aspiration for young people. 59 per cent of 18-21 year olds feel that it is important to own a home.
Managing director at Halifax, Russell Galley, says: ‘Despite being one of the most important financial decisions we’re ever likely to make, becoming a homeowner feels like a mystery for Generation Z who will soon be thinking about flying the nest. Although our research found that the vast majority of 11 to 14-year-olds understand what a mortgage is, one in 10 aged 18 to 21 think stamp duty is money to pay for stamps – so there’s clearly a job for all of us to help kids get a better idea of what’s involved with taking the first step on to the property ladder.’