Student debt is preventing young adults from becoming homeowners. Thirty-year-olds with student debt are less likely to own a home than their peers without debt, reports the Federal Reserve Bank of New York on its Liberty Street Economics Blog. An analysis of 2013 data from the Fed's Consumer Credit Panel shows not only an ongoing decline in the percentage of 30-year-olds with home-secured debt, but a steeper decline for those with student loans.
It didn't used to be this way. Until the Great Recession, young adults with student loans were more likely to have home-secured debt than those without loans. That's because the debtors were more likely to be college graduates and earn higher incomes. But student debt has become so onerous and the earnings of college graduates so meager that the American Dream of homeownership has become The Impossible Dream.
Source: Federal Reserve Bank of New York, Liberty Street Economics Blog, Just Released: Young Student Loan Borrowers Remained on the Sidelines of the Housing Market in 2013
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