Saturday, August 2, 2014
Inquirer Daily News

College costs crowd homebuyers out

NY Fed reports

College costs crowd homebuyers out

"The share of 25-year-olds with student debt has increased to 43 percent last year from 25 percent in 2003," while the number of college grads under 30 who are buying homes has plunged -- and, yes, it turns out that people who are still paying off student loans are less likely to buy homes than their peers, reports the Federal Reserve Bank of New York (via Newsday story here.) NY Fed report here. 

Home-sellers' loss is colleges' gain. Are lenders grabbing their share, too? Student lender Sallie Mae, Wilmington, earned less than expected during the three months of 2013, as interest income from the company's portfolio of old federally-guaranteed student loans declined, analyst Sameer Gokhale of Janney Capital Markets told clients in a report today.

But Sallie Mae's new private (non-government-backed) student loans rose to $1.4 billion during the three months ended March 31, up 22% from last year and above the expected $1.3 billion, while loan losses stayed low, Gokhale added. Still, the company continues shrinking, as it has since Obama and the Democrats in Congress took back government-guaranteed student loan originations from Sallie Mae and other private companies in 2010. The company is cutting staff through "targeted and natural attrition," according to Gokhale.

Joseph N. DiStefano
About this blog

PhillyDeals posts raw drafts and updates of Joseph N. DiStefano's columns and stories about Philly-area finance, investment, commercial real estate, tech, hiring and public spending, which he's been writing since 1989, mostly for the Philadelphia Inquirer.

DiStefano studied economics, history and a little engineering at Penn, taught writing at St. Joe's, and has written the book Comcasted, more than a thousand columns, and thousands of articles, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
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