More than 1.5 million young adults believe student loan repayments are making it harder to save for a home, according to research from OneFamily.

The Lifetime ISA provider found that 70% of people aged 18 to 40 who have a student loan and are saving for a property said repayments were making it more difficult to build a deposit.

The findings add to evidence of the financial pressures facing prospective first-time buyers, with rent and household bills competing with student loan deductions for a share of disposable income.

OneFamily’s research, based on a survey of 2,000 adults aged 18 to 40, also found that 29% of respondents with a student loan believed the debt was preventing them from achieving wider life goals.

More than a quarter, 27%, said they regretted going to university because of the amount they owed.

YOUNGER BORROWERS FEEL GREATER PRESSURE

The research found a marked difference between generations. Almost half, 48%, of Gen Z respondents said their student loan limited their financial options, compared with 29% of Millennials.

Concern about student debt was also higher among Gen Z, at 40%, against 26% among Millennials.

The findings come as the average student loan balance among graduates in England has risen above £53,000, according to figures cited by OneFamily. For some borrowers, including those with Plan 2 loans, interest can mean balances continue to increase despite repayments being made.

The survey also asked those saving for a property what they would do if their student loan were written off. Almost all, 99%, said they would direct at least some of the resulting money towards their home ownership goal.

Gemma, a 22-year-old social worker in Lincolnshire who graduated in 2025, said: “I started repaying my student loan last year, I’m currently paying back £48 a month. It feels almost like an added tax coming straight out of my pay cheque. When I worked out how much I’d repaid so far, I was surprised by how much that money could have added up in savings.

“I think student loans can be barrier for young people trying to get on the property ladder. Even if the monthly amount seems small, it’s still money being taken away from future plans.

“With the cost of living so high, every penny matters.”

DEPOSIT CHALLENGE

Beth Tait, personal finance champion at OneFamily, said: “There are already a huge number of barriers making it challenging for young people to buy their first home. It’s a big life goal and more needs to be done to help people achieve it.

“Right now, thousands are stuck in a ‘rent and repay’ trap – juggling high costs, as well as their student loans, making it difficult to put aside much at the end of the month.

“It’s worrying to see so many feeling stuck in a cycle that is difficult to break out of. There are solutions out there, like the lifetime ISA, to help young people manage their money and reach their life goals.

“But there is still much more work to do in terms of financial education and resources to help this generation save and build financial resilience.”