The Day – Student Loan Debt Keeps Majority of Millennials Homeowner

According to a new survey released today by the National Association of Realtors®, 60% of non-home millennials say student loan debt delays their ability to buy a home, by far the most affected population.

The results also show that Americans burdened with high student debt see the impact on their daily lives. They often have to choose between investing in retirement, buying a house, getting married, starting a family, or saving in general.

NAR partnered with Morning Consult on The Impact of Student Loan Debt report.

“Housing affordability is getting worse, leaving future homebuyers with student loan debt at a huge disadvantage,” said Charlie Oppler, president of NAR, Realtor® of Franklin Lakes, NJ, and CEO of Prominent Properties Sotheby’s International. “Young Americans shouldn’t have to choose between education and homeownership, and NAR continues to pursue policies that ensure the American Dream remains available and accessible to those who still pay for their college education.”

The new research also reveals that only 23% of student loan debt holders understood the costs of attending college before taking out loans. In addition, 35% of these student loan holders did not fully understand their earning potential after graduation.

According to the report, 51% of all student loan holders say their debt has delayed them in buying a home. Thirty-six percent of student loan debt holders say student loan debt delayed their decision to leave a family member’s home, a percentage that rises to 52% among black debt holders. Ultimately, the report shows that 31% of millennials and 28% of black students in debt would use their extra funds to buy a home in the future without student debt.

“In addition to just buying a home, this report finds that more than half of people with student loan debt have delayed some form of major life choice,” Oppler continued. “Student loan debt isn’t just seeping into housing affordability. It also affects other aspects of people’s lives. “

To deal with the growing debt burden, NAR supports a multi-pronged approach. Financial education should be expanded to help students make decisions about funding their studies, while aid programs should be simplified. For those who hold debt, the options to consolidate and refinance their debt at lower rates will help debt holders reduce their monthly debt payments, make large purchases, and make wise lifestyle choices. Finally, NAR promotes the expansion of tax preferences for employers who help employees settle their student loan debt as well as the tax exemption for debt holders whose debt is canceled or repaid by their employer.

NAR has collected and reviewed research over the past eight years to assess the impact of student debt on prospective home buyers. The data model now claims that student loan debt is one of the biggest barriers between a potential buyer and the ability to buy a home.

Today’s new findings build on last year’s annual survey of successful homebuyers, Profile of Home Buyers and Sellers, which found student loan debt to be the most important factor. important delaying their ability to save for buyers who had difficulty saving for a down payment. This research found that black homebuyers were more than twice as likely to have student debt as white homebuyers, with a median amount of $ 10,000 more than white homebuyers.

The Impact of Student Loan Debt survey was modeled on the 2016 and 2017 NAR reports, with a narrower scope. The research themes are comparable, but the most recent report considers the federal government’s current stimulus package and how the COVID-19 pandemic has affected debt in our country.

—National Association of Real Estate Agents® (NAR)

Source link

About Joan Dow

Check Also

Don’t forget to take care of your 401 (k) if you join ‘Great Resignation’

valentinrussanov | E + | Getty Images Leave the money or move it? The first …