EDUCATION

It's not just tuition and fees: College students are facing increasingly high rent prices, too

Spiraling off-campus rents are wreaking havoc on America's college students, driving many of them deeper into debt and even threatening to squeeze some out of higher education.

Jon Marcus
The Hechinger Report

BERKELEY, Calif. — When she transferred to the University of California, Berkeley, JoLynn Kelly split a bunk bed in a tiny loft apartment – and the $2,800 a month it cost to rent.

“I had to get a loan just for that,” said Kelly, now a senior who plans to become a math teacher. After racking up $16,800 in debt, she finally moved out and now commutes from her parents’ house, 30 minutes away on the rare occasions when there isn’t traffic.

“It’s insane,” she said of the cost of housing in this city east of San Francisco. “Everyone is either taking out loans, or someone else is paying for it or they’re commuting.”

Rents have gone up more than 9% over the last year in Berkeley, according to Zillow. Nationwide, they’ve risen 14%, on average, the real estate firm Redfin reports – and by even more than that in cities tracked by Realtor.com that have large student populations, such as Boston (up 24%), New York (21%) and Austin, Texas (20%).

That’s becoming a huge problem for college students faced with spiraling off-campus housing costs. It’s also spilling over into long waiting lists for less-expensive on-campus dorms.

Off-campus living isn’t necessarily by choice. Few universities have space to accommodate all of their students on campus, and most require some to live off campus for at least part of the time they’re enrolled.

In Ann Arbor, Michigan, those students are confronting rents that now are 19% higher than they were last year, Zillow says; in Ithaca, New York, 29%; in State College, Pennsylvania, 32%; in Lawrence, Kansas, 22%; and in College Station, Texas, 29%.

Students walk in Sproul Plaza at the University of California, Berkeley, where surrounding rents for off-campus housing are up by more than 9% over last year.

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Not all colleges and universities are in major cities or in college towns such as Ithaca and Ann Arbor. But the price of off-campus student housing is up about 6% nationally.

That’s lower than the national average, mainly because landlords who rent to students hesitate to raise their rates too quickly, knowing that their units are likely to sit empty if they’re not leased by September. But it’s still triple the increase of the last several years, according to the real estate data analytics firm RealPage – a shock to student budgets, on top of other inflationary pressures they already face.

The organization that represents owners and landlords of off-campus student apartments, the National Multifamily Housing Council, puts the increase at a lower 2.3% . But even that can have a significant impact on students, said Matthew Berger, the organization’s vice president for student housing.

“Think about where students are in the earnings history of their lives,” Berger said. “They’re attempting to get an education, and they’re probably more concerned about the cost of housing than people who are employed and can afford it.”

Are rising rental prices turning college into 'a class issue' for some students?

The trend has major consequences for who goes to college and the quality of the colleges they choose, research suggests. Costs of living tend to be higher at the most selective institutions, for example, according to the Urban Institute; it found that lower-income students rule out those top schools by choosing universities and colleges where such costs are lower.

Students at campuses with higher living costs also end up having to borrow more, the same study found.

“It’s becoming such a class issue,” said Kaleo Mark, a Berkeley senior majoring in political science and economics. “It’s really depressing how college is getting to be a place for only wealthy, upper-class people.”

Mark and his three roommates paid $3,225 a month last year for a two-bedroom apartment off campus, he said, but their landlord is raising the price by 37%, and they were forced to move. Although Mark’s parents are covering his rent, “even taking that into account, my roommates and I were priced out.”

A student walks past off-campus housing near the University of Texas campus in Austin.

Housing and food together come to an average of $11,950 a year at four-year public universities, or more than tuition and fees for in-state students, according to the College Board. At private, nonprofit colleges, they average $13,620, or more than a third of the total price. Those room and board costs have increased by 35% and 33%, respectively, over the last 10 years.

“The notion that tuition and fees is the central problem in higher education often overlooks the other expenses students face, and housing is a massive one,” said Justin Ortagus, director of the Institute of Higher Education at the University of Florida.

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“If you’re a student who’s struggling to make ends meet, that can really impact your likelihood of remaining in college and ultimately obtaining your degree. You’re talking about this house of cards, and every issue is like pulling out another card.”

Even before these rent increases, many students were teetering on the edge. More than a quarter at community colleges and 16% at four-year universities said last year that they couldn’t meet their rent or utility bills, according to a survey of 195,000 students by the Hope Center at Temple University. The problem was worse for Black and Native American than for white students, the center found.

The housing office at the University of California, Berkeley, whose neighbors sued to freeze enrollment on the grounds that students living off-campus were forcing up rents, among other reasons.

Some try to stick it out, even when they lose their housing altogether. One in 10 California State University and one in 20 University of California students are homeless while enrolled in school, a UCLA study found.

A faculty member at California State University, East Bay told of going to his office on a weekend and finding a student sleeping in the bathroom, and of a theater major who was living in her car and turned down a role in a play because she had to work.

The price of rent is about even with the cost of tuition as the top reason students drop out, another study, by Ortagus and his colleagues, found.

“Even if you’re a high-achieving student from a low-income household, you don’t necessarily have the family support to pay these kinds of rents,” Ortagus said. “Certain subgroups of students are going to be squeezed out of higher education.”

Many likely are forgoing college altogether, he and other experts said.

“If a student can’t get housing there’s a great possibility that they can’t attend the university,” said Pamela Schreiber, assistant vice president for student life and executive director of housing and food services at the University of Washington and president of the Association of College and University Housing Officers International.

There are 'tremendous waitlists,' from Florida to Utah, for on-campus housing

Now the off-campus housing crunch is affecting on-campus housing, which is typically cheaper and for which there is intensifying competition.

“There are institutions that are seeing tremendous waitlists,” Schreiber said.

At Florida Atlantic University, the number of applications for on-campus housing for the fall rose dramatically, the university said, partly due to escalating off-campus rents in the surrounding community of Boca Raton, which increased 35% in the last year and are 66% higher than the national median. The university has had to lease out two nearby hotels to accommodate the overflow.

In Tallahassee, Florida, where Zillow reports that rents have gone up 53% in the last year, Florida A&M University offered off-campus housing subsidies of $2,000 apiece to about 700 freshman and transfer students who applied for on-campus housing but for whom there wasn’t any space.

In Knoxville, where rents are up by 43% in the last year, the University of Tennessee has instituted a controversial lottery system for on-campus housing because so many people applied for rooms.

The University of Utah, which had a peak of more than 3,500 students on a waiting list for on-campus housing, is asking alumni who live nearby to lease space to students for $5,000 per semester. Rents in Salt Lake City are up 14% over last year.

And about 440 students at the University of North Carolina at Charlotte were told in mid-July that the university wouldn’t have enough on-campus housing for them this fall.

Moving trucks line a street near the University of Texas in Austin as students prepare for the start of the school year. Rents for off-campus housing are up nationwide; in Austin, they’re 20% higher than a year ago.

“Institutions do whatever they can to accommodate as many students as possible,” said Schreiber, whose own university is converting double rooms into triples. Rents in Seattle are 21% higher than last year.

Demand from students also pushes up rents for their neighbors. Boston has called on its universities and colleges to build enough new dorms for 18,500 students at a cost of more than $2.6 billion to free up housing for permanent residents.

UC Berkeley’s neighbors sued successfully to freeze enrollment on grounds including that it was forcing up rents for everybody; while that ruling was counteracted by the legislature and the governor in March, there is now a proposal to speed up the construction of new dorms at California’s public universities, too, by streamlining the regulatory process.

“The need is so massive,” said state Sen. Scott Wiener, who introduced the measure. “There are kids who may get into a top school and there’s nowhere they can afford to live, so they don’t go there.”

It takes years to build more housing, however, and there are indications that the cost of rent will only continue to increase in the meantime. One reason is that, as expensive as they are, off-campus apartments are experiencing record occupancy; in June, 86% were already leased for the coming fall, the highest number ever, according to RealPage.

“It doesn’t appear that pricing is deterring students,” said Carl Whitaker, RealPage’s director of research. “The demand seems there to keep rent growth above historic norms. They’re leasing up faster than ever.”

This story about the cost of college housing was produced by The Hechinger Report, a nonprofit, independent news organization focused on inequality and innovation in education. Sign up for our higher education newsletter.