Countless case studies have established a connection between education and homeownership: generally, college graduates are more likely to own a home than non-graduates. A new study out of Trulia now shows that career stage, level of education and location can have varying degrees of influence on homeownership rates.
Being college-educated typically boosts earning potential, which opens up housing options in terms of affordability and size. The median income for bachelor’s degree-holders is $82,202, according to Census data, while the median income for those without a degree is $48,842. The homeownership rate among the former is 16 percent higher than the homeownership rate for the latter, the study shows, and, homes owned by bachelor’s degree-holders feature more square footage than those without: seven rooms versus six.
Incomes tend to grow as careers do, whether a college graduate or not, but incomes expand more as experience stacks up for college graduates than non-graduates. Homeownership rates, as a result, increase more for college graduates as careers progress, the study shows. The median income for college graduates rises from $74,843 at age 22-35, when the homeownership rate is 42 percent, to $105,387 at age 50-63, when the homeownership rate is 82.2 percent. The median income for non-graduates, to compare, rises from $39,045 at age 22-35, when the homeownership rate is 25 percent, to $53,000 at age 50-63, when the homeownership rate is 63.8 percent.
What’s more: If a bachelor’s degree leads to more income and higher homeownership rates, it stands to reason succeeding levels of education (e.g., graduate, doctorate) result in even more income and even higher homeownership rates. In reality, incomes and homeownership rates fluctuate at higher levels of education, the study shows. Doctorate-degree holders, for example, for whom the median income is $117,684, roughly $17,000 less than the median for a professional degree-holder at $134,680, own homes at a rate of 73.7 percent, below that of professional degree-holders at 76 percent.
Several housing markets, still, buck the higher education prerequisite simply because a degree-worthy income isn’t necessary to own a home, the study shows. Homeownership rates among those without a high school diploma are above 50 percent in affordable Deltona-Daytona Beach, Fla., and Gary, Ind., where the median home value trails the national median. In Long Island, N.Y., the homeownership rate among those with a high school diploma but no college degree blips at 74.5 percent.
Notably, the findings of the study hold even considering student debt obligations, which have been partly to blame for homebuyers’ inability to enter the market. Higher education, no matter its cost, the study shows, is undeniably tied to success in homeownership.
For more information, please visit www.trulia.com.
Suzanne De Vita is RISMedia’s online news editor. Email her your real estate news ideas at sdevita@rismedia.com.
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