Reconsidering the Conventional Wisdom on Student Loan Debt and Home Ownership

By Beth Akers. Last spring, the Federal Reserve Bank of New York (FRBNY) released new evidence on the relationship between student loan debt and home ownership.  It found that during the financial crisis, young people with student loan debt had become less likely than those without debt to take on mortgage debt (a proxy for home ownership) by the time they reached age 30.  It was suggested that this reversed the long-run trend in which individuals with student loan debt, who tended to be wealthier and more educated than their debtless peers, were more likely to own a home.  Although this analysis provided useful information about student loan debt, it is subject to a number of limitations. More...