The Link Between Education and Homeownership Deepens
Being well educated has never been more important when it comes to owning a home.
A new report from First American Financial Corp. has found that the difference in homeownership between those without high school degrees and those with a bachelor's degree or more is widening. In 2015, that gap was 28%, nearly twice the 15% gap reported in 1990.
"People with higher education levels are more likely to earn higher incomes, and thus more likely to own homes," said First American chief economist Mark Fleming in a press release Thursday. "The good news is that educational attainment levels are improving nationally, so we are on the right track."
Education levels are rising as more millennials are graduating from college and entering the workforce. Millennials are outpacing baby boomers when it comes to receiving a college education. But they are falling behind in other arenas, Fleming said.
"Because of education and lifestyle decisions, young millennials are more likely to have a college degree and less likely to be married or have children than their baby boomer or even Generation X counterparts at the same age," he said.
The share of households with married couples dropped 0.4% year-over-year in 2015. And since 1991, the number of children per household on average has dived 18.7%. These declines are not without their own effects, since "the timing of important life decisions will have a significant impact on homeownership in the near term," Fleming noted.
The highest level of educational attainment is the District of Columbia, while Utah was the state with the lowest. On the metropolitan level, Charlotte, N.C., has the highest attainment, while Sacramento, Calif., ranks last.
Overall, the First American Homeownership Progress Index reported a 1.8% year-over-year decrease. The index now stands just 0.4% above the 25-year low set in 1995. New Hampshire and Vermont have the highest rates of homeownership, while Idaho experienced the biggest growth in homeownership from 2014 with a 5% increase. Colorado, meanwhile, posted an 11.3% drop in homeownership for the biggest decrease nationwide.