The 2016 Profile of Home Buyers and Sellers survey is the second year we have collected data on the difficulty of saving for a down payment to buy a home and whether student loans were an impediment.
In years past, the down payment had been cited as one of the most problematic steps in the home buying process. In the 2016 report, the number grew slightly to 13 percent of buyers that had difficulty saving for the down payment and, of those, the number that reported student loan debt made saving the most strenuous step in the buying process jumped to 49 percent. For first-time buyers in the 2016 report, who are predominantly Millennials under the age of 34 years, 26 percent said saving for the down payment was the most arduous step in the process and, of those, 55 percent stated that student loan debt delayed them from buying a home.
For all buyers this year, a little more than a quarter (27 percent) reported having student loans with a median of $25,000 in debt. For first-time buyers, 40 percent cited still having student loans with a median amount of $26,000 in debt.
What’s more interesting is the amount of student loan debt that respondents cited around the country by subregion. The median student debt was the lowest at $20,000 in the Pacific states of Washington, Oregon, California, Alaska, and Hawaii, as well as the West South Central states of Texas, Oklahoma, Arkansas, and Louisiana. The median student loan debt was the highest at $40,000 in the East South Central states of Kentucky, Tennessee, Mississippi, and Alabama.
A majority of the regions reported student loan debt delaying buyers from purchasing a home. On the low end, debt delayed the South Atlantic and East South Central subregions for a median of two years. On the high end, debt delayed New England and Pacific states for a median of five years and the Mountain and West South Central subregions for a median of four years.
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