--- title: The Return of Student Loan Payments Could Put the Squeeze on Homebuyers description: Borrowers hoping to become homeowners will have to juggle restarted student loan payments with existing housing affordability issues. authors: - name: Adam Hardy role: Lead Data Reporter url: https://money.com/author/adam-hardy/ bio: Adam Hardy is a lead data journalist at Money, where he frequently reports on financial barriers that affect low-income Americans. Adam’s work has also appeared in Business Insider, Forbes, Nasdaq, The Penny Hoarder, Yahoo! Finance and more than a dozen local and regional newspapers. education: University of South Florida, BA, Magazine Journalism at_money_since: 2021 articles: 499 covers: - Housing - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Pets - Professional Services - Retirement - Shopping - Taxes - Technology also_seen_in: - The Penny Hoarder - Forbes Advisor - Creative Loafing - The New York Times - The Washington Post - Bloomberg - Harvard Law School - The Federal Register - National Consumer Law Center - CBS News - Becker's Hospital Review - Business Insider - Mother Jones - The Week - Fortune - The Philadelphia Inquirer - National Association of Student Financial Aid Administrators (NAFSAA) - Education Advisory Board (EAB) - The Institute for College Access & Success (TICAS) - This Morning with Gordon Deal - Empower - Reddit social: - https://www.x.com/hardyjournalism - https://www.linkedin.com/in/hardyjournalism/ editors: - name: Julia Glum role: Managing Editor url: https://money.com/author/julia-glum/ bio: Julia Glum joined Money in 2018 and specializes in covering financial trends that affect everyday Americans' wallets. She also writes Dollar Scholar, a weekly newsletter that teaches young adults how to navigate the messy world of money. education: University of Florida at_money_since: 2018 articles: 453 covers: - Housing - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Professional Services - Retirement - Shopping - Taxes - Technology also_seen_in: - Newsweek - International Business Times - CBS News - Good Morning America - WUSA9 - Pix 11 - The New York Times - Mashable - The Washington Post - CNBC - Politico social: - https://x.com/superjulia - https://www.linkedin.com/in/julia-glum published: '2023-07-26T12:14:25.000Z' modified: '2024-01-10T15:04:02.000Z' section: Housing tags: - News - Student Loans word_count: 706 canonical: https://money.com/student-loan-payments-squeeze-homebuyers/ type: NewsArticle source: structured-blocks --- > **Disclosure:** We may earn a fee if you click on the links below. Compensation does not determine ranking. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Photo-illustration of a house being squeezed by a clamp.](https://img.money.com/2023/07/News-Student-Loan-Payments-House-Buying.jpg) Student loan payments are slated to resume soon for millions of borrowers — and those looking to buy a home will bear the pressure of their restarted loan bills while facing one of the [least affordable housing markets in U.S. history](https://money.com/housing-affordability-lowest-level-in-history/). Recent research suggests that the student loan moratorium — which paused payments and interest accrual for more than three years due to the pandemic — helped some borrowers [save up for a down payment](https://money.com/how-much-down-payment-is-required-for-a-house/). In the meantime, however, home prices have soared while interest rates have spiked, pushing homeownership out of reach for many. And being back on the hook for hundreds of dollars in [monthly student loan bills](https://money.com/student-loan-payments-restarting-monthly-bill-amount/) is only expected to exacerbate the issue. “For housing, we should celebrate that many Americans were able to get a head start on saving for a down payment thanks to the forbearance program,” Ali Wolf, the chief economist of the housing-research firm Zonda, [wrote](https://www.builderonline.com/data-analysis/what-the-end-of-the-student-loan-forbearance-means-for-housing_o) in a June blog post. “As that policy ends, we need to understand that \[those gains\] since 2020 will again reverse.” Zillow, an online real estate marketplace, [recently analyzed](https://www.zillow.com/research/student-loan-affordability-32871/) how much the typical student loan borrower was able to save since the start of the student loan moratorium. It then compared that amount to the down payment needed to buy a home in 50 of the largest metropolitan areas in the U.S. - The ordinary borrower has delayed about $15,000 worth of student loan payments so far through the moratorium, Zillow found. - In 29 major housing markets, the everyday student loan borrower could have saved at least as much to make a 5% down payment on the median home in the area. (Though a 20% down payment is often thought of as the gold standard, a down payment around 5% is often more realistic for first-time buyers.) - Pittsburgh; St. Louis; Memphis, Tennessee; and Birmingham, Alabama; were among the cities most favorable to student loan borrowers saving up for a down payment. ## But... Zillow’s analysis assumes that borrowers were able to save the money that would have been going toward their student loan payments throughout the moratorium. It’s not clear how many borrowers were actually able to do that. Separate research suggests that borrowers have [put that money to use elsewhere](https://money.com/student-loan-forgiveness-spent-more/?ref=/student-loan-payments-credit-scores/) — and in some cases, the skyrocketing cost of everyday necessities has staked its claim on the cash that was freed up from paused payments. - For instance, just in terms of housing costs throughout the pandemic, Zillow says new home loans have more than doubled in price. Rents have risen about 27%. - According to [data](https://fred.stlouisfed.org/series/MSPUS) from the Federal Reserve of St. Louis, median home prices have risen more than 35% since the student loan moratorium went into effect. Even for the borrowers who were able to save, restarted payments will shrink their budgets. A recent analysis from Wells Fargo found that the typical borrower will face payments between $210 and $314 a month. “The resumption of student loan payments this fall introduces new challenges when it comes to housing affordability, particularly for many aspiring first-time buyers,” wrote Nicole Bachaud, senior economist at Zillow, in the report. ## On the other hand Starting in October, the first [federal student loan bills will be due](https://money.com/when-do-student-loan-payments-resume/) for the first time since 2020. To help borrowers cope with the financial shock of restarted payments, the Biden administration has said missed payments through September 2024 won't affect anyone's credit. Still, for many cash-strapped borrowers, the extra monthly bill will no doubt be another barrier separating them from homeownership. However, some experts are suggesting that the overall effect of the resumption of [student loans](https://money.com/student-loans/) could help cool prices in the long run — which could ultimately work to put homes in reach. “The excess money in the economy \[from paused student loan payments\] has likely contributed to today’s elevated levels of inflation,” Wolf, from Zonda, wrote. “If consumers pull back on spending, this could help ease inflation and take the pressure off the Federal Reserve.” [How the Restart of Student Loan Payments Could Hurt (or Help!) Your Credit Score](https://money.com/student-loan-payments-credit-scores/) [Zillow and Other Rental Sites Are Now Disclosing Sneaky 'Junk Fees' Upfront](https://money.com/zillow-rental-sites-junk-fees/) [The 10 Places Where Rent Has Surged the Most Since Last Summer](https://money.com/rent-increase-cities-june/) ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/student-loan-payments-squeeze-homebuyers/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Housing", "item": "https://money.com/housing/" }, { "@type": "ListItem", "position": 3, "name": "Home Buying", "item": "https://money.com/home-buying/" }, { "@type": "ListItem", "position": 4, "name": "The Return of Student Loan Payments Could Put the Squeeze on Homebuyers" } ] }, { "@type": "WebSite", "@id": "https://money.com/#website", "url": "https://money.com", "name": "Money", "publisher": { "@id": "https://money.com/#organization" } }, { "@type": "WebPage", "@id": "https://money.com/student-loan-payments-squeeze-homebuyers/#webpage", "url": "https://money.com/student-loan-payments-squeeze-homebuyers/", "name": "The Return of Student Loan Payments Could Put the Squeeze on Homebuyers", "isPartOf": { "@id": "https://money.com/#website" }, "datePublished": "2023-07-26T12:14:25.000Z", "mainEntity": { "@id": "https://money.com/student-loan-payments-squeeze-homebuyers/" }, "inLanguage": "en-US", "breadcrumb": { "@id": "https://money.com/student-loan-payments-squeeze-homebuyers/#breadcrumb" }, "dateModified": "2024-01-10T15:04:02.000Z" }, { "@type": "NewsArticle", "headline": "The Return of Student Loan Payments Could Put the Squeeze on Homebuyers", "articleSection": "Housing", "image": [ { "@type": "ImageObject", "url": "https://img.money.com/2023/07/News-Student-Loan-Payments-House-Buying.jpg", "width": 2880, "height": 1920, "caption": "News-Student-Loan-Payments-House-Buying" } ], "author": [ { "@type": "Person", "name": "Adam Hardy", "url": "https://money.com/author/adam-hardy/", "@id": "https://money.com/author/adam-hardy/#author", "description": "Adam Hardy is a lead data journalist at Money, where he frequently reports on financial barriers that affect low-income Americans. Adam’s work has also appeared in Business Insider, Forbes, Nasdaq, The Penny Hoarder, Yahoo! Finance and more than a dozen local and regional newspapers.", "image": "https://img.money.com/2022/01/a_adam-hardy.jpg?quality=85&w=400&h=440&crop=1", "email": "adam.hardy@money.com", "jobTitle": "Lead Data Reporter", "alumniOf": "University of South Florida, BA, Magazine Journalism", "subjectOf": [ { "@type": "WebPage", "url": "https://www.thepennyhoarder.com/", "name": "The Penny Hoarder" }, { "@type": "WebPage", "url": "https://www.forbes.com/advisor/", "name": "Forbes Advisor" }, { "@type": "WebPage", "url": "https://creativeloafing.com/", "name": "Creative Loafing" }, { "@type": "WebPage", "url": "https://www.nytimes.com/2023/05/01/opinion/biden-trump-harris-2024.html", "name": "The New York Times" }, { "@type": "WebPage", "url": "https://www.washingtonpost.com/opinions/2022/12/26/flexible-spending-account-is-flawed-benefit/", "name": "The Washington Post" }, { "@type": "WebPage", "url": "https://www.bloomberg.com/opinion/articles/2025-09-20/-100-000-h-1b-visa-fee-is-a-gamble-that-could-protect-us-jobs", "name": "Bloomberg" }, { "@type": "WebPage", "url": "https://petrieflom.law.harvard.edu/2024/02/08/whoop-and-the-irs-how-tax-avoidance-helps-health/", "name": "Harvard Law School" }, { "@type": "WebPage", "url": "https://www.federalregister.gov/documents/2025/12/29/2025-23853/weighted-selection-process-for-registrants-and-petitioners-seeking-to-file-cap-subject-h-1b#footnote-33-p60883", "name": "The Federal Register" }, { "@type": "WebPage", "url": "https://www.nclc.org/resources/what-states-can-do-to-stop-credit-reporting-abuses/", "name": "National Consumer Law Center" }, { "@type": "WebPage", "url": "https://www.cbsnews.com/news/open-enrollment-irs-changes-fsa-hsa-flexible-spending-account-health-savings-account-2023/", "name": "CBS News" }, { "@type": "WebPage", "url": "https://www.beckershospitalreview.com/rankings-and-ratings/20-top-us-hospitals-for-2025-per-money/", "name": "Becker's Hospital Review" }, { "@type": "WebPage", "url": "https://www.businessinsider.com/using-chatgpt-ai-write-cover-letters-job-applications-2023-2", "name": "Business Insider" }, { "@type": "WebPage", "url": "https://www.motherjones.com/politics/2026/04/a-major-strike-of-beef-workers-pauses-in-colorado-but-workers-say-the-fight-isnt-over/", "name": "Mother Jones" }, { "@type": "WebPage", "url": "https://theweek.com/business/economy/job-market-frozen-thawing", "name": "The Week" }, { "@type": "WebPage", "url": "https://fortune.com/2023/12/20/workers-lose-money-on-unused-fsa-accounts-deadlines-what-companies-should-do/", "name": "Fortune" }, { "@type": "WebPage", "url": "https://www.inquirer.com/opinion/editorials/liberation-day-tariffs-economy-stock-market-trump-20250401.html", "name": "The Philadelphia Inquirer" }, { "@type": "WebPage", "url": "https://www.nasfaa.org/news-item/37955/Student_Loan_Changes_2026_New_Repayment_Options_Taxable_Forgiveness_and_More_on_the_Way", "name": "National Association of Student Financial Aid Administrators (NAFSAA)" }, { "@type": "WebPage", "url": "https://eab.com/resources/blog/adult-education-blog/graduate-funding-shift-pricing-aid-strategies-aligned/", "name": "Education Advisory Board (EAB)" }, { "@type": "WebPage", "url": "https://ticas.org/california/state-private-loans-protections-blog/", "name": "The Institute for College Access & Success (TICAS)" }, { "@type": "WebPage", "url": "https://thismorningwithgordondeal.com/b/This-Morning-with-Gordon-Deal-August-04,-2026/421564107823081285.html", "name": "This Morning with Gordon Deal" }, { "@type": "WebPage", "url": "https://www.empower.com/the-currency/life/pumpkin-spice-season-spending", "name": "Empower" }, { "@type": "WebPage", "url": "https://www.reddit.com/r/Economics/comments/1va10oa/comment/p0i9bju/", "name": "Reddit" } ], "sameAs": [ "https://www.x.com/hardyjournalism", "https://www.linkedin.com/in/hardyjournalism/" ], "worksFor": { "@id": "https://money.com/#organization" } } ], "publisher": "https://money.com/#organization", "datePublished": "2023-07-26T12:14:25.000Z", "description": "Borrowers hoping to become homeowners will have to juggle restarted student loan payments with existing housing affordability issues.", "abstract": "Borrowers hoping to become homeowners will have to juggle restarted student loan payments with existing housing affordability issues.", "@id": "https://money.com/student-loan-payments-squeeze-homebuyers/", "inLanguage": "en-US", "dateModified": "2024-01-10T15:04:02.000Z", "editor": [ { "@type": "Person", "name": "Julia Glum", "url": "https://money.com/author/julia-glum/", "@id": "https://money.com/author/julia-glum/#author", "description": "Julia Glum joined Money in 2018 and specializes in covering financial trends that affect everyday Americans' wallets. She also writes Dollar Scholar, a weekly newsletter that teaches young adults how to navigate the messy world of money. ", "image": "https://img.money.com/2021/10/a_julia-glum.jpg?quality=85&w=400&h=440&crop=1", "email": "julia.glum@money.com", "jobTitle": "Managing Editor", "alumniOf": "University of Florida", "subjectOf": [ { "@type": "WebPage", "url": "https://www.newsweek.com", "name": "Newsweek" }, { "@type": "WebPage", "url": "https://www.ibtimes.com/", "name": "International Business Times" }, { "@type": "WebPage", "url": "https://www.cbsnews.com/news/home-office-tax-deduction-who-qualifies/", "name": "CBS News" }, { "@type": "WebPage", "url": "https://www.goodmorningamerica.com/living/story/coupon-queen-woman-tik-tok-share-tips-couponing-66302189", "name": "Good Morning America" }, { "@type": "WebPage", "url": "https://www.wusa9.com/video/entertainment/television/programs/great-day-washington/tips-to-being-better-with-money-in-2021/65-a5b83e05-73ba-4d60-b9a8-1d47f9ac6018", "name": "WUSA9" }, { "@type": "WebPage", "url": "https://pix11.com/news/coronavirus/rebound/making-ends-meet/millenials-taking-biggest-financial-hit-from-pandemic/", "name": "Pix 11" }, { "@type": "WebPage", "url": "https://www.nytimes.com/2019/09/10/opinion/active-shooter-drill-schools.html", "name": "The New York Times" }, { "@type": "WebPage", "url": "https://mashable.com/article/forrest-fenn-treasure-found", "name": "Mashable" }, { "@type": "WebPage", "url": "https://www.washingtonpost.com/news/post-nation/wp/2014/08/13/theres-an-app-for-that-authorities-say-man-asked-siri-for-help-dumping-body/", "name": "The Washington Post" }, { "@type": "WebPage", "url": "https://www.cnbc.com/2020/06/08/treasure-buried-by-forrest-fenn-finally-found-after-10-years.html", "name": "CNBC" }, { "@type": "WebPage", "url": "https://www.politico.com/tipsheets/florida-playbook/2017/03/gillum-for-governors-rollout-stumble-florida-woman-gets-trump-shout-out-rubios-tampa-office-problems-218973", "name": "Politico" } ], "sameAs": [ "https://x.com/superjulia", "https://www.linkedin.com/in/julia-glum" ], "worksFor": { "@id": "https://money.com/#organization" } } ], "wordCount": 706, "keywords": [ "News", "Student Loans" ], "about": [ { "@type": "Thing", "name": "Housing in the United States", "sameAs": [ "https://en.wikipedia.org/wiki/Housing_in_the_United_States" ] }, { "@type": "Thing", "name": "Real estate", "sameAs": [ "https://en.wikipedia.org/wiki/Real_estate" ] }, { "@type": "Thing", "name": "Student loans in the United States", "sameAs": [ "https://en.wikipedia.org/wiki/Student_loans_in_the_United_States" ] } ] } ] } ```