While many Americans were economically devastated as a result of the pandemic, others fared much better. In a new survey by the National Association of Realtors (NAR), 54% of student-loan borrowers said the pandemic allowed them to get a better handle on their student debt or allowed them to pay it off earlier than planned. The survey respondents were majority non-homeowners, and they told NAR that their student debt will delay their plans for homebuying anywhere from a few months up to eight years. Of the 54% of respondents that were non-homeowners, 19% said student loans will delay homeownership for more than eight years.
These findings align with previous research that has suggested the nation’s student-debt crisis was preventing many from achieving homeownership. A previous study from the Federal Reserve found that the increase in student debt accounted for a 2 percentage-point drop in the homeownership rate among young adults. That study suggested that some 400,000 people were unable to become homeowners as a result of their student debt.
For the 46% of student-loan borrowers in the National Association of Realtors’ survey who have not managed to emerge from the pandemic in a better financial status, this lost time could have serious ramifications for their future ability to purchase a home.
The inability to become homeowners may have other financial ripple effects for student-loan borrowers. A third of renters with student debt said they were unable to contribute money toward retirement savings, more than double the share of homeowners who said the same, according to the report from the National Association of Realtors.