Dive Brief:
- Economists can agree on two facts – homeownership among people under age 35 hit a record low in the U.S. earlier this year, and the debt owned on student loans reached a high.
- Unclear is whether the debt is to blame for the falling ownership, which economist and former Treasury Secretary Lawrence Summers believes. Economist Mark Kantrowitz argues that it's due to other post-recession changes in the lending market and there's no provable connection between debt and buying.
- Student debt is now at $1.1 trillion while homeownership among those under 35 stands at 36.2% after it peaked at 43.6% in 2004.
Dive Insight:
Debt does not help in an atmosphere of more stringent underwriting. There has also been a growing gap between the increase in house prices and the increase in U.S. wages. On the other hand, people in the age group just are not forming households as young as they once did, so there is less incentive to buy.