A recent survey by the Halifax Building Society found that the next generation of buyers think purchasing a property is ‘child’s play’.
If you have been through the process of buying your first home – and particularly if you have already made several moves – you may not feel quite the same, but the survey is interesting in that it does suggest our children are able to cut through some of the scary headlines and are fairly positive about getting on the ladder.
Despite the average age of a first-time buyer being just over 30, more than a quarter of 18 to 21-year olds were much more optimistic, believing they will be able to buy a home by the time they’re 25. For young adults in the Midlands, as long as they start saving for a deposit now, that’s certainly achievable, as our property prices are very reasonable compared with the national average.
However, the young adults surveyed might not have got everything quite right. Our favourite survey response was that one in ten 18 to 21-year olds thinks Stamp Duty is exactly what it says it is: money you have to pay for stamps. The good news is that, because first-time buyers don’t actually have to pay Stamp Duty on a property up to the value of £300,000 (as per the Autumn Budget announcement that came into effect on 22nd November 2017), hopefully they won’t have to worry about it for some time!
In the Midlands, according to the Halifax, the average first-time buyer pays between £163,005 in the East Midlands through to £168,627 in the West Midlands, both prices being well within the zero stamp duty zone.[1]
The survey did also reveal that young people might need to learn a little more about mortgages, with one in five 11 to 14-year olds believing that a mortgage means you can borrow as much as you like to buy a home, unaware of the reality of having to go through quite stringent affordability checks. On the plus side, that means the remaining 80% have a better understanding of the financial aspect of home ownership. As for the length of time it takes to buy a property, 15% of 18 to 21-year olds are under the impression that it takes more than a year to complete a purchase. [2]
A couple of nice surprises from the survey suggest that, although Generation Z felt the internet and good WiFi was important in a home, they were actually more keen to make sure they met their new neighbours. Young adults also consider buying a sofa to be more important than having a house warming party, suggesting that their priorities when moving into their own home are more akin to those of older generations than we might have realised.
So it appears that, although today’s children seem to take a sensible approach and are optimistic about buying and owning property, they are still not very well-informed about the actual process. As Russell Galley, Managing Director of Halifax, said: “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.”
Whether you’re keen for your children to get on the ladder, are thinking about investing in a property for your children to benefit from at a later date or would like to find out how much you can afford to pay for your first home, we’re here to help.
