Hostname: page-component-8448b6f56d-dnltx Total loading time: 0 Render date: 2024-04-18T04:05:31.828Z Has data issue: false hasContentIssue false
  • English
  • Français

Does Student Loan Debt Structure Young People’s Housing Tenure? Evidence from England

Published online by Cambridge University Press:  26 January 2021

ARIANE DE GAYARDON Open the ORCID record for ARIANE DE GAYARDON [Opens in a new window] ,
CLAIRE CALLENDER Open the ORCID record for CLAIRE CALLENDER [Opens in a new window]  and
STEPHEN L. DESJARDINS
ARIANE DE GAYARDON
Affiliation:
Centre for Global Higher Education, UCL Institute of Education, 20 Bedford Way, London WC1H 0AL, United Kingdom and Center for Higher Education Policy Studies, University of Twente, Enschede, Netherlands. email: a.gayardon@ucl.ac.uk +44 20 7911 5344
CLAIRE CALLENDER
Affiliation:
Centre for Global Higher Education, UCL Institute of Education and Birkbeck, 26 Russell Square, LondonWC1B 5DQ, United Kingdom
STEPHEN L. DESJARDINS
Affiliation:
Center for the Study of Higher and Postsecondary Education, University of Michigan, 610 E University Ave, Ann Arbor, MI 48109, United States
Get access Rights & Permissions [Opens in a new window]

Abstract

This article analyses the interaction between two policy areas affecting young people in England – housing and student funding. It is the first of its kind exploring a range of dynamics in the relationship between housing and student loan debt. Young people today are far less likely to own their home and are more likely to live with their parents than earlier generations. In parallel, higher education tuition fee increases have led to a growing share of students taking out loans and graduating with higher debt, which they will be repaying for most of their working lives. This research examines the relationship between student loans – having borrowed for higher education and attitudes towards debt – and housing tenure at age 25, using the Next Steps dataset. We find that young graduates who did not borrow for higher education are more likely to own their home and less likely to rent or live with their parents than graduates who borrowed for their studies or young people who never attended higher education. These results suggest that higher education funding policies and student loan debt play important roles in structuring young people’s housing in England.

Keywords

housingyoung peoplehomeownershipparental co-residencehigher educationstudent loans
Type
Article
Information
Journal of Social Policy , Volume 51 , Issue 2 , April 2022 , pp. 221 - 241
Copyright
© The Author(s), 2021. Published by Cambridge University Press

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Andrew, M. (2010), ‘The changing route to owner occupation: The impact of student debt’, Housing Studies, 25, 1, 39–62, https://doi.org/10.1080/02673030903361656 CrossRefGoogle Scholar
Appleyard, L. and Rowlingson, K. (2010), ‘Home-ownership and the distribution of personal wealth: a review of the evidence’ (JRF Programme Paper: Housing Market Taskforce), York: Joseph Rowntree Foundation.Google Scholar
Avery, R., Goldscheider, F., and Speare, A. J. (1992), ‘Feathered nest/gilded cage: Parental income and leaving home in the transition to adulthood’, Demography, 29, 3, 375–388, https://doi.org/10.2307/2061824 CrossRefGoogle ScholarPubMed
Belfield, C., Britton, J., Dearden, L. and van der Erve, L. (2017a), ‘Higher Education funding in England: past, present and options for the future’ (IFS Briefing Note No. BN211), London: Institute for Fiscal Studies.Google Scholar
Belfield, C., Britton, J. and van der Erve, L. (2017b), ‘Higher Education finance reform: Raising the repayment threshold to £25,000 and freezing the fee cap at £9,250’ (IFS Briefing Note No. BN217), London: Institute for Fiscal Studies.CrossRefGoogle Scholar
Blaauboer, M. (2010), ‘Family background, individual resources and the homeownership of couples and singles’, Housing Studies, 25, 4, 441–461, https://doi.org/10.1080/02673031003711493 CrossRefGoogle Scholar
Bleemer, Z., Brown, M., Lee, D. and van der Klaauw, W. (2014), ‘Tuition, jobs, or housing: What’s keeping millennials at home?’ (Staff Reports No. 700), New York: Federal Reserve Bank of New York.CrossRefGoogle Scholar
Bolton, P. (2020), ‘Student Loan Statistics’ (Briefing Paper No. 1079), London: House of Commons Library.Google Scholar
Brown, M., Haughwout, A., Donghoon, L., Scally, J. and van der Klaauw, W. (2014), ‘Measuring student debt and its performance’ (Staff Reports No. 668), New York: Federal Reserve Bank of New York.CrossRefGoogle Scholar
Callender, C. and Mason, G. (2017), ‘Does student loan debt deter higher education participation? New evidence from England’, Annals of American Political and Social Science, 671, 1, 20–48.CrossRefGoogle Scholar
Christie, H., Munro, M. and Rettig, H. (2002), ‘Accommodating students’, Journal of Youth Studies, 5, 2, 209–235, https://doi.org/10.1080/13676260220134458 CrossRefGoogle Scholar
Christophers, B. (2018), ‘Intergenerational inequality? Labour, capital, and housing through the ages’, Antipode, 50, 1, 101–121. https://doi.org/10.1111/anti.12339 CrossRefGoogle Scholar
Coulter, R. (2016), ‘Local house prices, parental background and young adults’ homeownership in England and Wales’, Urban Studies, 54, 14, 1–20.Google Scholar
Coulter, R. (2018), ‘Parental background and housing outcomes in young adulthood’, Housing Studies, 33, 2, 201–223, https://doi.org/10.1080/02673037.2016.1208160 CrossRefGoogle Scholar
Cribb, J., Hood, A. and Hoyle, J. (2018), ‘The decline of homeownership among young adults’ (IFS Briefing Note No. BN224), London: Institute for Fiscal Studies, https://www.ifs.org.uk/uploads/publications/bns/BN224.pdf [accessed 19.11.2019].Google Scholar
de Gayardon, A., Callender, C. and Green, F. (2019), ‘The determinants of student loan take-up in England’, Higher Education, 78, 965–983, https://doi.org/10.1007/s10734-019-00381-9 CrossRefGoogle Scholar
Department for Education (DfE) (2011), ‘LSYPE user guide to the datasets: Wave 1 to wave 7’, London: Author.Google Scholar
Department for Education (2019), ‘Independent panel report to the review of post-18 education and funding’ (Issue CP 117), London: Author.Google Scholar
Drukker, D. (2016), ‘Estimating treatment effects from observational data using teffects, stteffects, and eteffects’, UK Stata Users Group meeting, London, https://fmwww.bc.edu/repec/usug2016/drukker_uksug16.pdf [accessed 21.05.2020].CrossRefGoogle Scholar
Edmonds, T. (2014), ‘Mortgage market review’ (Briefing Paper No. 05808), London: House of Commons Library.Google Scholar
Elliott, W., Grinstein-Weiss, M. and Nam, I. (2013), ‘Is student debt compromising homeownership as a wealth building tool’ (Center for Social Development Working Paper No. 13–33). St Louis: Center for Social Development, https://csd.wustl.edu/Publications/Documents/WP13-33.pdf [accessed 29.06.2017].Google Scholar
Elliott, W. and Lewis, M. (2015), ‘Student debt effects on financial well-being: Research and policy implications’, Journal of Economic Surveys, 29, 4, 614–636, https://doi.org/10.1111/joes.12124 CrossRefGoogle Scholar
Furlong, A. and Cartmel, F. (2007), Young people and social change: new perspectives (2nd ed.). Buckingham: Open University Press.Google Scholar
Gallent, N. (2019), Whose housing crisis? Assets and homes in a changing economy, Bristol: Policy Press.Google Scholar
Gicheva, D. and Thompson, J. (2015), ‘The effects of student loans on long-term household financial stability’, in Hershbein, B. J. and Hollenbeck, K. M. (eds.), Student loans and the dynamics of debt, Kalamazoo: W.E. Upjohn Institute for Employment Research, 287–316.Google Scholar
Hilber, C. A. L. and Schöni, O. (2016), ‘Housing policies in the United Kingdom, Switzerland, and the United States: lessons learned’ (ADBI Working Paper Series No. 569), Tokyo: Asian Development Bank Institute.CrossRefGoogle Scholar
Hiltonsmith, R. (2013), ‘How student debt reduces lifetime wealth’ (Debt-for-Diploma Series), London: Demos.Google Scholar
HM Land Registry (2019), ‘Average-prices-2019-07’ [Dataset], https://www.gov.uk/government/statistical-data-sets/uk-house-price-index-data-downloads-july-2019 [accessed 06.05.2020].Google Scholar
Houle, J. N. and Warner, C. (2017), ‘Into the red and back to the nest? Student debt, college completion, and returning to the parental home among young adults’, Sociology of Education, 90, 1, 89–108, https://doi.org/10.1177/0038040716685873 CrossRefGoogle Scholar
House of Commons Business, Innovation and Skills Committee (HoC) (2011), ‘Government reform of higher education: twelfth report of session 2010–12. Volume I’, HC 885, London: Stationery Office.Google Scholar
Lee, D. (2013), ‘Household debt and credit: Student debt’, New York: Federal Bank of New York, https://www.slideshare.net/NewYorkFed/household-debt-and-credit-student-debt Google Scholar
Luong, M. (2010), ‘The financial impact of student loans’, Perspectives on Labour and Income, 11, 1, 5–18.Google Scholar
Marks, G. N. (2009), ‘The social effects of the Australian higher education contribution scheme (HECS)’, Higher Education, 57, 1, 71–84.CrossRefGoogle Scholar
McKee, K., Moore, T., Soaita, A. and Crawford, J. (2017), “Generation rent’ and the fallacy of choice’, International Journal of Urban and Regional Research, 41, 2, 318–333. https://doi.org/10.1111/1468-2427.12445 CrossRefGoogle Scholar
McKee, K. and Soaita, A. M. (2018), ‘The ‘frustrated’ housing aspirations of generation rent’ (R2018_06_01), Glasgow: UK Collaborative Centre for Housing Evidence.Google Scholar
Mezza, A. A., Ringo, D. R., Sherlund, S. M. and Sommer, K. (2015), ‘On the effect of student loans on access to homeownership’ (Finance and Economics Discussion Series No. 2016–10), Washington: Board of Governors of the Federal Reserve System, http://www.federalreserve.gov/econresdata/feds/2016/files/2016010pap.pdf [accessed 06.09.2017].CrossRefGoogle Scholar
Miller, J. J. and Nikaj, S. (2018), ‘Student loan debt, educational attainment, and tenure choice’, Education Economics, 26, 4, 393–410, https://doi.org/10.1080/09645292.2018.1430749 CrossRefGoogle Scholar
Ministry of Housing, Communities & Local Government (MHCLG) (2019a), ‘English Housing Survey data on owner occupiers, recent first time buyers and second homes’, London: Author, https://www.gov.uk/government/statistical-data-sets/owner-occupiers-recent-first-time-buyers-and-second-homes [accessed 25.10.2019].Google Scholar
Ministry of Housing, Communities & Local Government (2019b), ‘Public attitudes to house building: findings from the British Social Attitudes survey 2018’, London: Author, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/841815/BSA_House_building_report.pdf [accessed 11.04.2019].Google Scholar
Ministry of Housing, Communities & Local Government (2020), ‘English Housing Survey: Headline report, 2018-19’, London: Author, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/860076/2018-19_EHS_Headline_Report.pdf [accessed 05.05.2020].Google Scholar
Mishory, J. and O’Sullivan, R. (2012), ‘Denied? The impact of student debt on the ability to buy a house’, Washington: Young Invincibles, http://www.cgsnet.org/ckfinder/userfiles/files/Denied-The-Impact-of-Student-Debt-on-the-Ability-to-Buy-a-House-8_14_12.pdf [accessed 29.06.2017].Google Scholar
Newman, K. and Aptekar, S. (2008), ‘Sticking around: Delayed departure from the parental nest in Western Europe’, in Danziger, S. and Rouse, C. E. (eds.), The price of independence: The economics of early adulthood, New York: Russel Sage Foundation, 207–230.Google Scholar
Office for National Statistics (ONS) (2017), Housing affordability in England and Wales: 2016, Newport: Author, https://www.ons.gov.uk/peoplepopulationandcommunity/housing/bulletins/housingaffordabilityinenglandandwales/1997to2016 [accessed 11.04.2019].Google Scholar
Office for National Statistics (2018), ‘Young adults living with parents, regions of England and UK constituent countries, 1996 to 2017’ [Dataset]. Newport: Author,Google Scholar
Office for National Statistics (2019), ‘Index of private housing rental prices, UK: monthly estimates’ [Dataset], Newport: Author, https://www.ons.gov.uk/economy/inflationandpriceindices/datasets/indexofprivatehousingrentalpricesreferencetables [accessed 11.04.2019].Google Scholar
Oosterbeek, H. and van den Broek, A. (2009), ‘An empirical analysis of borrowing behaviour of higher education students in the Netherlands’, Economics of Education Review, 28, 2, 170–177, https://doi.org/10.1016/j.econedurev.2008.01.005 CrossRefGoogle Scholar
Preece, J., Crawford, J., McKee, K., Flint, J. and Robinson, D. (2020), ‘Understanding changing housing aspirations: a review of the evidence’, Housing Studies, 35, 1, 87–106, https://doi.org/10.1080/02673037.2019.1584665 CrossRefGoogle Scholar
Purcell, K., Elias, P., Atfield, G., Behle, H., Ellison, R., Luchinskaya, D., Snape, J., Conaghan, L. and Tzanakou, C. (2012), ‘Futuretrack Stage 4: transitions into employment, further study and other outcomes’, Manchester: Higher Education Careers Services Unit, http://www.hecsu.ac.uk/assets/assets/documents/Futuretrack_Stage_4_Final_report_6th_Nov_2012.pdf [accessed 09.08.2017].Google Scholar
Roberts, S., Eager, B., Anderson, I., Baxter, R. and Boyd, P. (2020), ‘Can millennials get on the housing ladder without help?’, The Guardian, 7 January.Google Scholar
Roberts, J., Noden, P., West, A. and Lewis, J. (2016), ‘Living with the parents: the purpose of young graduates’ return to the parental home in England’, Journal of Youth Studies, 19, 3, 319–37.CrossRefGoogle Scholar
The Student Fees (Amounts) (England) (Amendment) Regulations 2008, no. 2507, Parliament (2008).Google Scholar
Shand, J. M. (2007), ‘The impact of early-life debt on the homeownership rates of young households: An empirical investigation’, Arlington: Federal Deposit Insurance Corporation Center for Financial Research, http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.527.6788&rep=rep1&type=pdf [accessed 06.09.2017].Google Scholar
Stone, J., Berrington, A. and Falkingham, J. (2011), ‘The changing determinants of UK young adults´ living arrangements’, Demographic Research, 25, 629–666, https://doi.org/10.4054/DemRes.2011.25.20 CrossRefGoogle Scholar
Student Loans Company (SLC) (2018), ‘Student loans in England: Financial year 2017-18’ (Statistics Publication), Glasgow: Author.Google Scholar
Student Loans Company (2020), ‘Previous annual repayment thresholds’, https://www.gov.uk/guidance/previous-annual-repayment-thresholds [accessed 27.09.2020].Google Scholar
Velez, E., Cominole, M. and Bentz, A. (2019), ‘Debt burden after college: the effect of student loan debt on graduates’ employment, additional schooling, family formation, and home ownership’, Education Economics, 27, 2, 186–206, https://doi.org/10.1080/09645292.2018.1541167 CrossRefGoogle Scholar
Wilson, W. and Bate, A. (2015), ‘Affordable rents (England)’ (Briefing Paper No. 05933), London: House of Commons Library.Google Scholar
Supplementary material: File

De Gayardon et al. supplementary materials

Appendices 1-3

Download De Gayardon et al. supplementary materials(File)
File 19.9 KB