The link between homeownership and educational attainment is easy enough to understand. More education means higher income, which means more money for a down payment, and a mortgage, and all the rest. The Millennial generation is the most educated generation in U.S. history. Yet it is not the most anchored.
A bachelor’s degree is not a requirement for homeownership, but it is starting to look like one. As household incomes are increasingly linked to educational attainment, so is homeownership status. At the same time, spending money on a better education can be, for a while, a barrier to homeownership. This paradox might be the driving factor of the U.S. housing market today, which is still slow to grow even despite a strong recovery.
First American, a U.S. title-insurance provider, tracks homeownership rates and related demographic and economic factors in its Homeownership Progress Index. Mark Fleming, the chief economist for First American, says that the change in education status is looking more and more pronounced in the housing market. “The [homeownership] gap is widening by education attainment level,” he says, adding, “Getting educated takes time. You’re much less likely to be a homeowner when you’re in college.”