By Lauren Lindstrom, The Charlotte Observer It’s not just rising prices and low inventory putting a squeeze on first-time home buyers. Many are coming into the market with an added hurdle: student debt. While buying a home is often a significant way to build wealth, younger buyers with heavy debt burdens can be shut out of the market. A report from the Federal Reserve published in 2019 found “a $1,000 increase in student loan debt…causes a 1 to 2 percentage point drop in the homeownership rate for student loan borrowers during their late 20s and early 30s.” The same report estimated “roughly 20 percent of the decline in homeownership among young adults can be attributed to their increased student loan debts since 2005.” These loans weigh on a buyer’s debt-to-income ratio, and affect the size of the loan they qualify for. Less buying power can be an obstacle as home sales prices continue to climb in the Charlotte metro area, where the median sales price surpassed $340,000 last month. The average Charlottean with student loan debt had a balance of more than $37,000 last year, slightly more than state and national averages, according to an article by Lending Tree’s Student Loan Hero site. Read more at The Charlotte Observer Main Photo: New houses are being added on to neighborhoods in the Steele Creek area. Homes in the 28273 ZIP code are drawing homebuyers’ attention for its affordability and new construction. MOLLY MATHIS / MMATTHIS@CHARLOTTEOBSERVER.COM
Student debt a ‘roadblock’ for Millennials who otherwise can afford Charlotte homes
New houses are being added on to neighborhoods in the Steele Creek area. Homes in the 28273 ZIP code are drawing homebuyers' attention for its affordability and new construction. MOLLY MATHIS / MMATTHIS@CHARLOTTEOBSERVER.COM