The American dream of homeownership is becoming increasingly elusive for Millennial and Gen-Z buyers as they grapple with student loan payments resuming in October. While some managed to secure ultra-low mortgage rates when buying homes during the pandemic, first-time Millennial homebuyers face a number of persistent challenges, including rising interest rates, escalating home prices, inventory shortages, and, resuming this month, student loan payments adding to an already heavy financial burden.
With the typical monthly student loan payment being around $200, some homebuyers may feel compelled to lower their housing budgets by 8% to accommodate this additional expense, according to Forbes.
In contrast to their millennial counterparts, Generation Z may approach homeownership differently. Having witnessed the financial struggles of older generations, Gen Zers may be more cautious about taking on excessive student loan debt. Gen-Z may prioritize choosing affordable education options or pursuing high-demand careers that don't require a college degree, thus reducing their reliance on student loans. Americans under 30 currently owe less in student debt than Americans in their 30s.
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