Student debt coupled with higher downpayment requirements is keeping first-time homebuyers out of the market, an article in the Seattle Times reported.

Currently, student debt averages $27,000 per student. Considering today’s mortgage downpayments average just below 20% of the home price, first-time homebuyers are effectively priced out of the market. 

According to the report, homeownership among individuals who are paying off student loans is 36% lower than those who have no student debt.

As a result, student credit scores take a beating, and they have a difficult time qualifying for a mortgage. 

But the ripple effect does not end there. With less first-time purchasers entering the housing market, owners of modest-priced starter homes find it more difficult to sell and move up, the article noted.