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The Student Loan Debt and Housing Report 2017 by the National Association of
Realtors and the nonprofit group American Student Assistance shows the obvious: Student debt delays household formation, home buying, and saving. [Here are the details summarized for a fast and easy read].
This article is an edited ([ ]) and revised (…) version of an article by Mike “Mish” Shedlock to ensure a faster & easier read. It may be re-posted as long as it includes a hyperlink back to this revised version to avoid copyright infringement.
The U.S. currently has a student debt load of $1.4 trillion, which accounts for 10% of all outstanding debt and 35% of non-housing debt…Student loan debt caused:
- 22% to delay moving out of a family member’s home after college by at least two years
- among non-homeowners, 83% to delay buying a home. This is most frequently the case due to the fact that the borrowers cannot save for a down payment because of their student debt
- among homeowners, it is impacting the ability of 28% of graduates to sell their existing home and move to a different home. The delay in buying a home among non-homeowners is 7 years and 3 years for homeowners.
Awareness of Tuition Costs
- Before attending college, 28% of borrowers knew generally the school “might be expensive” or “might be cheap”, but had no further information.
- More than 25% of borrowers had an understanding of tuition, but had little understanding of other costs such as fees and housing expenses.
- 20% of borrowers understood all the costs including tuition, fees, and housing.
Defaults
- 32% of student loan borrowers surveyed had defaulted or forbore on their student loan debt.
- 40% of borrowers who had personal incomes of less than $25,000 in 2016 had defaulted or forbore on their student loan debt in the past.
Life Choices
- Among life choices, more than 50% of respondents believe they are delayed in continuing their education or starting a family due to student loan debt.
- 41% would like to get married, but are delayed from marriage due to their student loan debt.
- Only 13% of respondents did not have a life event delayed due to debt.
- 28% of respondents rent with roommates.
- 15% live with friends or family and pay rent, and
- 15% live with friends and family and do not pay rent.
- 20% own their own home and
- 16% rent solo.
- 35% of younger millennials live with family (both paying and not paying rent) compared to just 24% of older millennials.
Student Debt Impacts
Mish Notes
- Younger millennials are those born 1990 to 1998. Older millennials are those born 1980 to 1989.
- The study did not ask how many regretted going to college.
- The study did not ask how many regretted paying what they did pay for college.
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