'Rohit Chopra, the student loan chief at the CFPB, reckons that the links between the mortgage market and the student debt market aren’t just superficial – they’re causal, too: “Student debt may be more intertwined with the housing market than we realise and it may prove more important every day to understand that connection,” he told the FT’s Shahien Nasiripour and Robin Harding. That connection may already be having an impact: In June, first-time purchasers made up 32% of homebuyers, down 2% from May. In 2011, first-time buyers accounted for 37% of all purchasers, but that’s still the second-lowest level in the past decade, according to the National Association of Realtors. Regulators and realtors aren’t the only ones who are noticing or who are concerned by this macroeconomic relationship. Credit Suisse’s chief economist, Neil Soss, agrees with Chopra’s diagnosis: “We are trying to migrate towards a much safer underwriting standard, with let’s say 20 percent down payments required,” Soss said today. “It takes a certain amount of time for people to save that up, and the more they’re burdened with student loans the less possible it is for them to accumulate that chunk of liquid capital that allows them to make that.” 'http://blogs.reuters.com/felix-salmon/2012/07/25/counterpart...IOW, the next generation of prospective homeowners may be in the first stages of a new vicious cycle - which will also take the current generation's fortunes down with them.-------------------MDP Home Fool
Best Of |
Favorites & Replies |
Start a New Board |
My Fool |
BATS data provided in real-time. NYSE, NASDAQ and NYSEMKT data delayed 15 minutes.
Real-Time prices provided by BATS. Market data provided by Interactive Data.
Company fundamental data provided by Morningstar. Earnings Estimates, Analyst Ra