The struggle for young Americans to get a place on the U.S. property ladder is intensifying.

A new report issued Thursday by the New York Federal Reserve found that up to 35 percent of the recent dramatic decline in home ownership can be explained by the rising piles of loans millennials are taking out to finance their education, doing so at a time when government funding for colleges is waning and colleges are, in turn, subjecting students to massive hikes in tuition.

Student loans now average about $37,000 for graduates of the Class of 2016, with monthly payments for those loans preventing them from saving for a down payment and making monthly mortgage payments, freezing them out of the residential home market.

The millennials are either turning into a permanent renter class or boomeranging back to childhood homes to live with mom and dad. Nearly 45 percent of people in their early twenties live with their parents, up from 33.5 percent in 2004, the Fed said.

Home ownership among young consumers dropped off rapidly following the Great Recession, from 32 percent in 2007 to 21 percent in 2016. This occurred at a time of record-low interest rates when in most U.S. housing markets it was cheaper to buy a home than to rent.

That's a chief reason why homebuilders have increasingly turned towards move-up and luxury home building and away from starter homes: the buyers are just not there.