The housing industry might need to start engaging with policymakers to act on the student loan crisis because the New York Fed recently came out with a study that clearly shows student loan borrowers are less likely to purchase a house than people that do not have student loan debt.
This figure shows that for student loan borrowers with greater than $25,000 in student loan debt, they are less likely to own a home. The homeownership rates are about 2% to 3% higher for every age between 23 and 33 so this clearly shows high debt loads equals lower homeownership.
College graduates are more likely to own homes; however, those with student debt are less likely to own homes than those that are debt free. However, those that have a college graduate degree and student debt are much more likely (about 20%) to own a home than Americans that did not attend college at all.
So what can we learn from these facts by the New York Fed? The answer is simple: If we want homeownership rates to increase, we'll need to address the student loan crisis in the meantime.
Moby Debt Blog
GradFin will be periodically updating you on our company.