Is it true that in football (in the British sense) it's not against the rules to hang around the goal area but it is considered very bad etiquette?

Nah defenders hang around there own goal all the time haha. Nah seriously like Tuna mentioned in a competitive game you'd have to be in front of the last defender as the ball gets passed to you otherwise you'd be offside...

But when you just playing with friends and you don't have linemen or camera technology it would be difficult to work out so yeah then it's just bad etiquette but usually the sh!ttest player on the pitch hangs around the goal gets the ball and misses the shot by a mile every time anyway, lolz, so yeah when it's just a kick around nobody really cares.😄
乂^◡^乂

The offside rule pretty much prevents that, in competitive football. You can't receive the ball if you're past the last defender in the opposition's half when a horizontal line is drawn across the pitch. That's the basics of it. So it pretty much prevents goal hanging, which is what we would call it.