When it comes to saving, many members of Gen Z show a strong sense of financial responsibility and are focused on saving for a variety of financial goals. The most common of these is to buy a home: 29% of 18-27 year olds are planning to buy a property within the next three years.
To help make this a reality, saving for a home was the most common savings goal cited by respondents to our research: 30% of Gen Z savers are putting money aside for their own property, while 13% of our survey respondents already have a mortgage or are in the process of applying for one.
London-based members of Gen Z are particularly likely to be saving to get on the property ladder, which is the case for 37% of them. The largest proportion of those hoping to get a mortgage in the next one to three years live in London (20%).
This is no small challenge considering the average age of a first-time buyer in the UK is 34 and the average asking price of a first-time buyer home is £227,000. Compare this with the Boomer generation (born 1946 to 1960), for example, who might have bought their first home for around £4,000 (~£64k in today’s money).
House prices are a key factor for young buyers, yet only one-third of respondents cited them as their primary concern or the reason they don’t yet have a mortgage—suggesting that, while important, other factors are also weighing on this generation, such as raising the adequate funds for a deposit.
A lack of understanding of the mortgage process (23%) and anxiety over taking on long-term financial commitments (22%) also featured highly. Once again, reiterating the requirement for lenders to focus on education and support to this generation.
The Gen Z classification also spans different phases of life, and there are many Gen Zs who aren’t yet ready for home ownership and a mortgage. Many others aren’t looking to buy (36%), or they prefer to rent (20%): for many young people, home-buying has become such an impossibility that it doesn’t feature in their current list of life goals.
