Only three in 10 of today's 16 to 18-year-olds think they will ever be able to buy a home despite receiving better financial education than the previous generation, according to research.
The Open University Business School (OUBS) has published a study showing pessimism about home-ownership is not confined to so-called millennials but is also part of the psyche of up-and-coming Generation Z.
Financial education became a mandatory part of the secondary school curriculum from September 2014, meaning Generation Z ought to have a better grounding in the topic than previous generations, the OUBS stated.
But the OUBS research centre, The True Potential Centre for the Public Understanding of Finance (True Potential PUFin), found 70 per cent of 16 to 18-year-olds did not believe they would ever be able to buy a home, while 65 per cent did not think they would ever be able to save up a deposit.
According to the findings, which are from a OnePoll survey of 1,000 UK 16 to 18-year-olds between 25 September and 3 October, one in seven (15 per cent) already suffer with stress because of money worries.
The government has launched schemes to incentivise people save for a deposit, including the Help to Buy Isa and the Lifetime Isa.
David Harrison, managing partner of True Potential, said the UK savings gap meant many people will struggle to build up the funds to get on the housing ladder.
He said: “There are two main underlying issues. First, not enough people are saving adequately.
"Second, many of those who are putting money aside are seeing inflation wipe out any growth they might get on the high street, so their savings are really losing value.
“Cash savings accounts rarely offer interest above 0.5 per cent today but inflation is at 3 per cent. Investing can offer above-inflation returns so this is where more education is needed to demystify and to explain the potential ups and downs.”
Kevin Hever, helper and adviser at Wolverhampton-based Cornerstone Financial, said: “I would have thought the figures would always have been quite low when it comes to young people’s confidence about owning a property because it has always been something that younger people have struggled to see themselves doing.
“When you are 16 years old, even buying a car seems like a leap from where you are at the moment.
“That said, I think it is getting ever more difficult because house prices do seem to be going up quicker than average wages.
“I suppose really it is up to lenders to come up with more innovative products that can help people get on the ladder.
"If there is any suggestion of it going back to 100 per cent loan-to-value, that causes outrage in the media – but it has got its part to play for some people.”
simon.allin@ft.com
