Federal Reserve: Student Loans, not avocado toast, are a leading cause of low millennial home ownership

[samoyed]

Unfortunately, even with debt forgiveness (a long shot), it still wouldn't magically turn out millennials in droves to the realtors.

The psychological and cultural damage of the Great Recession is permanent. Millennials will be the financial PTSD generation of the 21st century, like the Depression-era generation was for the 20th century (minus the world wars which we're not all that far from tbh).

Good fucking job you gormless shits, you fucked up your own retirement.

 

[Dark Ninja]

Even with no debt (I paid off all my student loans) prices are still prettty high. But it's almost getting to the point where rent is too high where you might as well buy. I've been thinking about buying but it's gonna take another 5 years to have enough money and feel comfortable.

 

[LegendofJoe]

As far as I know. Godspeed.

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The thought of how much fun I'm going to have helps me to deal with the stress and think positively.

The plan right now is for a few friends, my brother, my buddy in Montreal, and my wife (because she's cool and I love her) to all meet up in Montreal and enjoy the Sin City of the North to its fullest.

 

[Sweeney Swift]

I'm so angry right now

 

[Alvis]

A year of college in the United States can easily cost $15,000 even at an affordable public university.

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What the fuck

Here it's like ~800€ per year IF you have to pay at all, which again, if you request a scholarship you don't, and you get a substantial amount of money on top of that per year which is yours forever as long as you pass...

 

[Dark Ninja]

Even with no debt (I paid off all my student loans) prices are still prettty high. But it's almost getting to the point where rent is too high where you might as well buy. I've been thinking about buying but it's gonna take another 5 years to have enough money and feel comfortable.

 

[Cantaim]

Huge if true

 

[samoyed]

What the fuck

Here it's like ~800€ per year IF you have to pay at all, which again, if you request a scholarship you don't, and you get a substantial amount of money on top of that per year which is yours forever as long as you pass...

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bUt wE hAvE tHe BeSt sChOoLs

 

[Ziltoidia 9]

Oh, so they are figuring out now that hamstringing a full generation isn't a good idea.

 

[JCX]

Both of my older siblings are in this boat. They make good livings, but the debt prevents them from this. It's really disheartening to see.

 

[Alvis]

bUt wE hAvE tHe BeSt sChOoLs

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Great schools! Really good! Amazing! The best! Unlike these affordable European schools! Fucking commies! Sad!

 

[Pooh]

It's absurd. I actually make a pretty good salary but I live paycheck-to-paycheck because of this shit. I could be contributing a lot to the economy but instead it's all getting funneled into the pockets of some rich assholes.

The best thing anybody could do for the economy would be student loan forgiveness. You want to see the economy take off like a rocket? There you go.

 

[Thorn]

No it's gotta be the avocado.

 

[LegendofJoe]

It's absurd. I actually make a pretty good salary but I live paycheck-to-paycheck because of this shit. I could be contributing a lot to the economy but instead it's all getting funneled into the pockets of some rich assholes.

The best thing anybody could do for the economy would be student loan forgiveness. You want to see the economy take off like a rocket? There you go.

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This would result in brisk, sustained inflation; but it would be good for the economy in the long-term. Inflation could then be brought back down with much higher interest rates, which would in turn bring house prices down to a reasonable level.

None of this should be done though until major reforms are made to ensure that young kids don't destroy their financial flexibility. It does no good to fix things now and then have to deal with the same problem all over again down the road.

 

[Mr. X]

I hate the further we slide into chaos, the more these studies 'pop up' showing what we knew years ago.

 

[AuthenticM]

nah it's avocados. Fake news.

 

[Pooh]

This would result in brisk, sustained inflation; but it would be good for the economy in the long-term. It could then be paired back with much higher interest rates, which would in turn bring house prices down to a reasonable level.

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Yeah I'm not saying it wouldn't have consequences especially in the short-term, any major change would, but the societal implications long-term are gonna be a lot worse without it.

 

[shadowsdarknes]

I'd have an extra 20 grand in the bank and Id be that much closer to a house if it weren't for them. I'm gonna buy soon, but Id be so much better off without them.

 

[MistaTwo]

I would easily have a house payment down by now if not for student loans. I probably wouldn't have needed medication for anxiety and depression either but that's another story.


Scholarships are given by the universities themselves and you don't have to pay them back. But those are comparatively rare to student loans.

If you take out student loans you have to pay them back. There are even privately-financed student loans which are basically the worst loans in the world to have (I know from experience).

With the government guaranteeing student loans and giving incentives to providers to loan out as much as possible, universities could raise tuition through the roof since "you have to get a degree to get a good job."

Here's a good video of Adam Ruins Everything that explains it, only about 5 minutes long: https://www.youtube.com/watch?v=PE66HEZBZYE

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It also varies a lot by state. The program is worse than when I was a student, but Florida made it incredibly easy to get a full ride thanks to Bright Futures.

One of the reasons why Florida is absolutely not the worst state in the union!

It was all paid for with lotto taxation iirc. So Millenial Florida Man probably can't afford a house because he buys too many lotto tickets.

 

[Parch]

Not unlike avacado toast, student loans are a choice.

 

[Alucrid]

i spent my student loans on avocado toast though

 

[Surface of Me]

My only hope at home ownership is inheritance.

 

[SJRB]

Ah yes, student loans. The "Dark Souls" of capitalism.

 

[nightstalker962]

Thanks Boomers, you absolutely disgusting wastes of oxygen!

 

[LegendofJoe]

Yeah I'm not saying it wouldn't have consequences especially in the short-term, any major change would, but the societal implications long-term are gonna be a lot worse without it.

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Agreed, the bright side though of this situation is that it will hurt the older generations. Even if you can afford an expensive house it's not a good idea to purchase one unless you don't need it for retirement security. A mansion that someone who is really wealthy would value may stay up in price, but otherwise you're going to really struggle to find a buyer at the price you want.

The high price of houses is unsustainable. A lot of boomers are going to find this out the hard way. Homes on golf courses are already starting to tank in value.

 

[samoyed]

I hate the further we slide into chaos, the more these studies 'pop up' showing what we knew years ago.

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It really is something. The news is exploding with apocalyptic shit today.

https://www.resetera.com/threads/ceos-fear-a-recession-more-than-anything-else-in-2019.94266/
https://www.resetera.com/threads/in...ictive-it-was-pharma-execs-didnt-care.94274/c
https://www.resetera.com/threads/ju...n-re-minors-spending-on-apps-and-games.94354/

 

[entremet]

I don't think it's just loans.

 

[Deleted member 6056]

Bloated costs of college degrees and the ridiculous padding of degrees with bullshit hours to suck money out of me is what hurts my income the most. I got a BA and an Associates and the combined debt is six figures before interest hell. Plus the BA which cost by far more than the other gave fuck all about finding legitimate work for students or job placement.
Been paying since 2012 and I'm not really seeing the debt budge. If I pay off more or earn more they just up my payments each year when I repackage so I never see any lifestyle improvement. If I need to pay something off I got to wait till july to make sure it doesn't come before debt to income calculation for the year otherwise I got no chance to increase my payments towards anything else for the next 12 months as the student loans will suck it up by scaling up in costs while never really marching down their principle much.

Fuck student loans. Fuck the way their interest and principle are calculated when you pay them. Fuck colleges for being more about private business mentality of maximizing their profits than the future of their students. Fuck so much about the American education system in general. It can go fuck itself into oblivion. Its not designed to improve the lives of students anymore for their futures. Its just their as a way for the college owners to make money off of young people desperate to secure a future who dont have enough experience yet to know what to do.

Whats truly insulting is that in both fields once I had the degree and could be hired in those fields because I could finally secure interviews I ended up only learning relevant skills at the job. The bulk of what I needed was learned through probationary work in both industrial and animation fields. From different softwares, pipelines, and such to running equipment, troubleshooting, and such. College was all theory and generalized horseshit. Folks should just fucking intern and apprentice folks based on aptitude and testing they put out themselves given what I discovered in both fields. It'd save their employees debt and make their lives easier to deal with in the workforce without that debt creating better employees in some fields. Lord knows I've trained folks with no background but who passed aptitude checks in both fields to be effective in 6 months.

 

[ghostemoji]

My student loans are a fraction of what many people's are and I still couldn't imagine being able to buy a home here in the Chicagoland.

 

[Ogodei]

No meaningful regulation of the housing market doesn't help either. "Values" swinging around wildly. Banks that caused the meltdown in the first place are now snapping up properties and renting them back out at exorbitant rates. Overseas investors (and just bored rich people) buying real estate all over the place and not living in it.

Already having a lot of debt is bad, but when the market is a wild west shitshow the problem is compounded.

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The problem is that you can't really regulate against that stuff. It's like rent control, landlords will just find every trick in the book to weasel out of their mandated low-rent tenants.

The housing market problem is NIMBYism at its core. That's why there's less of a crisis in places down south because there's plenty of land and little regulation and it's only overheated if you want prime real estate like beach property or other neat stuff, whereas in a tightly-regulated place like San Francisco you can make a million selling a bread box in an inaccessible part of town.

Cars are also somewhat the problem.

 

[Vagabond]

I have heard about mortgages that 'absorb' your Student Loan into the total mortgage loan. I'm not sure if my credit union offers something like that, but if they did I would be a first time homeowner.

 

[Yasuke]

My one year of grad school has often made me wonder what would happen to the loan if I just...killed myself.

Does it fall to someone, or just disappear?

 

[Pooh]

My one year of grad school has often made me wonder what would happen to the loan if I just...killed myself.

Does it fall to someone, or just disappear?

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Depends if you have a co-signer or not! If you don't, the debt disappears (after they sell your stuff I guess)

Love,
Somebody who has also thought about it, but has co-signers :(

Spoiler

don't kill yourself though

 

[Khanimus]

No shit

 

[Spenny]

Could be real

 

[MrNelson]

It also varies a lot by state. The program is worse than when I was a student, but Florida made it incredibly easy to get a full ride thanks to Bright Futures.

One of the reasons why Florida is absolutely not the worst state in the union!

It was all paid for with lotto taxation iirc. So Millenial Florida Man probably can't afford a house because he buys too many lotto tickets.

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And even if you aren't able to meet the requirements for the full ride, it's really easy to get the one that covers 75% of your tuition. You just have to be careful to not let your GPA dip below a certain point (2.75 I think?).

Of course this also requires you to be a Florida resident before you graduate high school and attend a public university in Florida.

 

[Mr. X]

I don't think it's just loans.

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It's a 2 hit bnb of high cost loans w/ interest and entry level positions paying low or ridiculous min exp/prereqs.

 

[onadesertedisland]

And it's gonna get worse. The only solution is to forgive and permit low payments for people deep in the shit. It's never getting paid back. Fund public universities so students don't have to enter indentured servitude.

 

[datbapple]

No meaningful regulation of the housing market doesn't help either. "Values" swinging around wildly. Banks that caused the meltdown in the first place are now snapping up properties and renting them back out at exorbitant rates. Overseas investors (and just bored rich people) buying real estate all over the place and not living in it.

Already having a lot of debt is bad, but when the market is a wild west shitshow the problem is compounded.

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This man gets it

 

[gogosox82]

No Fucking Shit. Anyone who wasn't a complete moron already knew this

 

[Fisty]

Choose one:

A. Pay your student loans and not be able to afford a house

B. Dont pay your student loans and not have good enough credit to buy a house

 

[Yasuke]

Depends if you have a co-signer or not! If you don't, the debt disappears (after they sell your stuff I guess)

Love,
Somebody who has also thought about it, but has co-signers :(

Spoiler

don't kill yourself though

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No co-signers. Guess I'd be good. And I ain't got shit to sell lmao so fuck em

 

[VariantX]

Of course. You likely have to get a degree of some kind to even have access to a job that would allow you to afford a home, much less rent anything without a roomate if you don't want to go to trade school. There's almost no way around it if you can't even get an interview if you don't have "x" degree on your resume.

 

[XMonkey]

I hope none of my tax dollars went to pay some chump at the Fed to come up with this no-shit report.

Fuck 'em.

 

[StarStorm]

No shit.
Either pay your student loans or not but have bad credit when buying homes.

I don't have any debt, but don't make anywhere near enough to purchase a home. Guess I'll enjoy some avocado toast though.

 

[Zoe]

Average Student Loan Monthly Payment: $351
-While it is a pain-in-the-ass, that payment is not the reason Millennial are not buying homes.

It is simply the cost of purchase (because of limited supply).

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Yep, I'm right in that range. That's not even half of what my rent was before buying.

 

[MasterSummerSmith462]

Ideally the feds should stop giving loans to anyone who applies.

 

[gogosox82]

Ideally the feds should stop giving loans to anyone who applies.

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But then they wouldn't have people in debt for the rest of their lives.

 

[Wilsongt]

If I hear Brenda bitch one more time about how she can't sell her house on the lake again, tho...