Student Loan Affecting Home Ownership

Are student loans keeping young people from buying homes? That’s a question that’s weighing on many people’s minds right now. But if the situation as simple as it seems.

On the one hand the more debt you have coming out of college the less money you have available to buy a home. Seems straightforward enough.

But according to economists at Core Logic, there’s more to the story. They claim that since student loan repayments are only a fixed percentage of income it’s not any harder to buy a home now than it has been before. No matter the size of the debt, monthly payments are just as easy (or hard) as they’ve always been.

Plus people who go to college should be that much more likely to expect to own a home at some point. So there’s that much more motivation to be a homeowner.

Do these factors balance out? How much debt do young people want to take on? These are issues that are going to be haunting us for the next few years as credit becomes looser and debts become higher.

Which direction do you think things will move?

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