The price tag on a college education is getting higher in many places — but, it’s not just tuition that’s costing students more.
Melissa Korn crunched the numbers and found that housing is one of the biggest drivers of rising college costs. And Arizona State University is at the top of the list when it comes to increased housing costs.
Korn reported the story for the Wall Street Journaland The Show spoke with her more about it.
MELISSA KORN: So housing prices at ASU went up significantly over the past 20-ish years. Even after adjusting for inflation, they increased by about 50% at the low end and tripled at the high end.
So the most expensive option nearly tripled over 20 years after inflation, which is an extraordinary increase.
LAUREN GILGER: How does this compare nationally? Because this is sort of a national trend you were able to track as well?
KORN: Yeah. So Arizona State actually topped the list of schools we looked at. We looked at a dozen major public universities around the country and ASU’s high-end housing had increased the most and was among the more expensive options of anywhere.
GILGER: But, across the board it does seem like housing costs have gone up at most colleges, right?
KORN: Absolutely. You know, there's a range of reasons why, but overall it's a lot more expensive to live on campus now than it was five years ago, 10 years ago.
GILGER: How does the housing market landscape in general compare with this as well? Because we've seen rising housing costs, rental costs are way up in the Valley here in Arizona, I mean, how do these rising rates of housing for students compare with just the rising cost of housing in general?
KORN: So we looked at some census data to show the rental rates in the areas immediately around the colleges that we looked at, right? Because the greater Phoenix area does look a little different than you know, a few blocks around Tempe campus. So we found that the rental prices, right around campus, increased at a slower pace than the least expensive option on campus at all 12 of our schools.
GILGER: So let's talk a little bit about the privatization of some of this as well. I didn't realize this had happened, but your reporting shows that many colleges and ASU included have done these sort of public-private partnerships to partner with a private company to run, essentially, their housing. Is this a cash cow?
KORN: It can be, it's not always. There have been some epic failures on this front, but it absolutely can be a nice revenue source for schools. And that is the case at ASU, they bring in millions of dollars a year just in the ground leases. So they lease their land to a private developer who builds and then runs a dorm and they often get a share of the rental revenue. So there is an incentive, the higher the rent, the more revenue you're bringing in, the bigger your share of that rental revenue.
GILGER: And in that you describe the dorms today and they sound very different than dorms when I went to college many years ago, right? Like it's almost like luxury housing in a way. There are swimming pools and gyms and all these kinds of amenities. What do dorms look like now?
KORN: Yeah, they do not look like your mother's dorm or your dorm. So ASU is a pretty great example of this where a lot of the housing either turned over from much more, kind of, spartan simple options or in some cases just they added a ton of housing and what they added is higher end options.
So gone are the lots of rooms on a long hallway with a shared bathroom down at the end that, you know, 30 people fight over every morning.
These are not, you know, 8-by-10 boxes where you and a roommate get to know each other very, very well. These are private rooms within a suite or sometimes shared rooms within a suite, maybe there's four people in the suite that share a bathroom. There's often a living room. I would like to live in some of these places myself as a grown adult. And they have many amenities. So a number of facilities at ASU for instance, have pools and volleyball courts and basketball courts and lounges, you know, game rooms, roof decks, that sort of thing. You know, they also, I should say, they also have study lounges and computer centers and places where classes even happen.
So you've got people who you know, take a course downstairs from where they live and kind of blurs that line of school, academic, extracurricular, which schools like and students say they like.
GILGER: That's really interesting. And honestly, this whole thing is so interesting because most of the conversation that happens around how expensive college is today is about tuition, right?
Like at ASU like President Michael Crow has pledged annual in-state tuition increases of no more than 3% for like a decade through, I think, the 2028- 29 school year.
But housing rates are not capped in the same way. What did ASU have to say about your story about being at the top of this list?
KORN: So ASU says there are a lot of reasons why their housing has gotten more expensive, including as you mentioned, the hot housing market in the Phoenix area.
They also say that they are responding to student demand. They are providing amenities that students are asking for or saying, you know, if we don't get this, we're not going to live on campus. So that's some of the things like pools and gyms and private rooms and private bathrooms.
They also say that the public-private partnership model, which you mentioned, yes, it brings in money for them, but they say that it allows them to focus their investing on academics and kind of the core of their operation rather than spending money building and operating dorms.
GILGER: So how do students, families deal with these housing costs today? Like is this becoming a barrier for a lot of students to go to college or are they living at home in a different way?
KORN: So, not all have the luxury of living at home, right? Even if you're going to an in-state school, that doesn't mean it's nearby where you live and a lot of schools do have residency requirements. You have to live on campus for your first year or your first two years. And in some cases, you have to live in a specific dorm because of your program.
So they can't just opt out and find some cheap place, you know, a half hour away or something they're kind of locked in, if they want to go to the school, it's part of the cost.
So I think it's something that a lot of families don't really think about until they're in the thick of things and actually getting their bills and choosing the rooms, it's hard to plan for because a lot of these schools have a huge range of housing prices, right? At ASU you can pay well under $10,000 for one option or over $20,000 for another option, and you don't always know which one you might get.
So it's hard to budget for that, but it is something that families should be looking at, just as they look at tuition and fees and all those other expenses related to being in college.
GILGER: Is this contributing to the conversation around, you know, the student loan crisis in our country right now, this, you know, trillions of dollars in debt that students have across the country?
KORN: Absolutely. And you know, one of the interesting things we found in our reporting here was that a number of schools offer really significant financial aid, but that usually is only for tuition and fees and can't be applied to housing.
There are some exceptions, of course, and ASU says it does provide financial aid for housing, but it's not enough to make $20,000 for, you know, an academic year apartment, very, very manageable for most people.
It's still a big barrier and you know, you have to apply, you have to appeal to get out of it, out of the housing requirements. You can not be an honors student, if you don't want to live in their housing, there's ways around it but it could affect the education you actually get.
