Student Loans and Homeownership

Source: Alvaro Mezza, Daniel Ringo, Shane Sherlund, Kamila Sommer, Journal of Labor Economics, Ahead of Print, November 13, 2019

From the abstract:
We estimate the effect of student loan debt on subsequent homeownership in a uniquely constructed administrative data set for a nationally representative cohort. We instrument for the amount of individual student debt using changes to the in-state tuition rate at public 4-year colleges in the student’s home state. A $1,000 increase in student loan debt lowers the homeownership rate by about 1.8 percentage points for public 4-year college-goers during their mid-20s, equivalent to an average delay of about 4 months in attaining homeownership. Validity tests suggest the results are not confounded by local economic conditions or changes in educational outcomes.