Home builders say student loan debt crisis linked to lower home values

From the Baton Rouge Business Report:

A new analysis of government data by the National Association of Home Builders says there's a connection between rising student loan debt and the onset of the housing slump. The analysis says home-owning parents who, in a healthy economy, would have used a home equity loan to help finance their kids' tuition weren't able to do so when the housing crisis led to a decline in loan availability. As a result, it says, students have increasingly taken out loans on their own behalf. "The data thus do not necessarily reveal a sharp increase in borrowing for college education, but rather a shifting in the form of borrowing," the analysis says. "And this is yet another consequence of the harm inflicted on the middle class as home prices fell, leading to a nearly 40% decline in median household net worth." The NAHB cites the 2010 edition of the Federal Reserve's survey of household balance sheets, the Survey of Consumer Finances, for the statistic on average net worth. The analysis also says any impact on housing demand caused by a forecast bursting of the student loan debt bubble will not be catastrophic as some in the industry are predicting. You can check out the NAHB's complete analysis here.