Graduate students in Little Rock’s long professional programs—at the University of Arkansas for Medical Sciences, UA Little Rock’s William H. Bowen School of Law, and the new Lyon College School of Dental Medicine—typically rent during their three or four years in the city. But for those who plan to stay in Central Arkansas after graduation, buying a home earlier may be worth considering, according to Jerry Larkowski, Managing Broker at ESQ. Realty Group, LLC and a licensed attorney.
Larkowski emphasizes that not every student should buy. Those headed to a residency or job in another state may be better off renting. For students who intend to remain in the area, however, a home offers privacy and quiet—important for studying for boards or the bar exam—and can become a long-term investment. “If one knows they will remain in Central Arkansas after school, it makes sense to start early,” he says. When income grows and it’s time for a larger home, the first house doesn’t have to be sold; it can become a rental property.
For students not ready to buy, Larkowski suggests setting a 12-month goal and using that time to learn the city. Visit open houses, walk neighborhoods, and spend time as a customer in local shops and restaurants. He recommends browsing homes currently for sale beforehand to decide which ones are worth the drive. “The best way to get to know a neighborhood is to walk it,” he says. “Drive there, park your car, and take a stroll.” Talking to lenders and realtors early is also crucial.
Student loans are a major factor in mortgage approval. Larkowski notes that student loans affect the debt-to-income ratio, even if they are in deferment. A $0 payment on a credit report does not mean a lender will count it as $0. Under FHA guidelines, 0.5% of the outstanding balance is typically counted monthly when no payment is reported, so a $200,000 balance could be treated as a $1,000 monthly payment. Fannie Mae guidelines may count a deferred loan at 1% of the balance or a fully amortizing payment. “How will you count my student loans?” is a question worth asking any lender before touring homes, as the answer can change the budget by hundreds of dollars a month.
On repayment plans, Larkowski advises choosing the one with the lowest monthly payment. “You will be able to ‘buy more house’ when it’s time,” he says, though a lower payment can mean more interest over the life of the loan. Federal loans made on or after July 1, 2026, will have fewer choices: a tiered standard plan or the income-based Repayment Assistance Plan.
Some students buy during school and rent out part of the property—a strategy known as house hacking. That might mean a duplex where you live on one side and rent the other, or a house with spare bedrooms for roommates. FHA financing can be used for an owner-occupied property with up to four units. “The duplex ‘house hack’ concept looks good on paper; if you can make it work, do it,” Larkowski says. He attaches two conditions: hire a property manager and never tell the tenant next door that you own the building, and put roommates on paper with a lease, no matter how good a friend they are.
Whether a student buys during school or two years after graduation, Larkowski’s advice on timing is the same: “You can start too late, but you can’t start too early.” More information is available at esqbrokers.com.
