Graduate students in Little Rock, Arkansas—including those 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—often face a common dilemma: should they buy a home or keep renting during their three- or four-year programs? According to Jerry Larkowski, Managing Broker at ESQ. Realty Group, LLC, and a licensed attorney, renting is often the right call, but not always.
Larkowski emphasizes that the decision hinges on whether a student plans to stay in Central Arkansas after graduation. For those headed to a residency or job elsewhere, renting keeps things simple. But for students who intend to remain in the area, buying a home can offer significant benefits, including privacy and quiet—critical for studying for boards or the bar exam. “If one knows they will remain in Central Arkansas after school, it makes sense to start early,” Larkowski says. He also points to a long-term advantage: when a graduate’s income grows and it’s time for a larger home, the first house can become a rental property rather than being sold.
For students not ready to buy immediately, Larkowski suggests setting a 12-month goal and using that time to learn the city. He advises paying attention to different neighborhoods, visiting open houses on Sunday afternoons, and 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.” He also recommends spending time in the area as a customer—shopping at nearby stores, eating at restaurants, and talking to residents about what living there is like. Additionally, students should talk to lenders and realtors early, long before making an offer.
Student loans are a major factor that often surprises students when they first meet with a lender. Larkowski explains that student loans affect the debt-to-income ratio just like a car loan, even when the loans 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 generally counted each month 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. Larkowski advises asking any lender, “How will you count my student loans?” before touring a single house, as the answer can change a budget by hundreds of dollars a month.
On repayment plans, Larkowski recommends choosing the one with the lowest monthly payment. “You will be able to ‘buy more house’ when it’s time,” he says, though he notes the trade-off of potentially more interest over the life of the loan, which should be discussed with a financial advisor. He also points out that federal loans made on or after July 1, 2026, will have fewer choices: a tiered standard plan or the income-based Repayment Assistance Plan.
For students considering house hacking—buying a property and renting out part of it—Larkowski says it can work with two rules. First, hire a property manager and never tell the tenant next door that you own the building. “The first time it happens for a burst water pipe at 3 a.m., you will wish you had used a ‘PM,’” he says. Second, put roommates on paper. “Be sure to have a lease, no matter how good a friend they are.” FHA financing can be used for an owner-occupied property with up to four units, making a duplex within reach for some buyers.
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.” For more information, visit esqbrokers.com.
