From Inman News:
"Student loan debt now totals $865 billion, which is greater than all credit card debt outstanding, as well as all other types of household debt except for mortgages.
College graduates have debt averaging $25,000. Even more troubling is the rise in debts associated with for-profit college and trade schools, whose revenues come primarily from debt available through federal government programs.
The debt load is so high, and the job outlook so bleak, that student loan default rates have almost doubled. With the economy little improved since 2009 (two-year lag on data), default rates are bound to rise further.
Student loans are going to be yet another hurdle for the housing market to overcome. Faced with mounting student loan debt, poor job prospects and stagnant wages, an increasing amount of 25- to 34-year-olds (a prized demographic for the housing sector) have moved back in with their parents. Almost 6 million 25- to 34-year-olds now live with mom and dad, up 26 percent from when the recession started in 2007.
Today's 36.8 percent homeownership rate for 25- to 29-year-olds is at its lowest level since 1999, and homeownership for 30- to 34-year-olds is at its lowest rate in 17 years.
The good news is that this pent-up demand will ultimately provide a much needed boost to the housing sector. The bad news is that the boost will be heavily skewed to the rental market, as it will take longer than ever for young people to qualify for a mortgage, especially if more and more graduates are hit with credit blemishes from unpaid student debt..."
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Based on sales by GGAR members and CRS data.
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