Medical debt is the number one obstacle preventing Americans from buying or renting a home, according to a new survey by Zillow.
The real estate listings website found that more than two-thirds of renters have some type of debt, whether it’s via credit cards, student loans, or medical bills.
Nearly 40 percent of the 13,000 adults polled by Zillow said they had been rejected for a mortgage or home rental because of medical debt. Among Millennials, medical debt was cited by 1 in 5 as an obstacle to home ownership.
Compared to other kinds of debt, medical debt has “a unique capacity to bust budgets,” according to Zillow.
“When we focus on low unemployment and the strong economy, we often forget that in many ways the rising costs of life can erode most of those gains,” Skylar Olsen, Zillow’s director of economic research, said in a press release. “Health care has never been more expensive. Getting a college degree, a path more likely to lead to economic success for those able to get through it, has never been more expensive. U.S. housing values and rents have never been more expensive.”
Zillow’s fourth-annual Consumer Housing Trends report also found that roughly two-thirds of renters and 44 percent of homeowners with medical debt were unable to cover an unforeseen $1,000 expense.
“While incomes, both at the high and low end, are growing, the pace hasn’t kept up with those crucial life expenses. That’s [a] fact, and Americans are feeling it,” Olson said.