The Journal of College and University Student Housing - Volume 41, No. 2 & Volume 42, No. 1 - 84

regarding their accommodations
and . . . they avoid signing contracts
with property owners with a large
meaning that students have a high

THE COLLEGE-TOWN
HOUSING MARKET
The role of uncertainty in the housing market
has been studied extensively in the ﬁeld of
economics, both theoretically (Stigler, 1961;
Wheaton, 1990) and empirically (Anglin,
1997; Robst, Deitz, & McGoldrick, 1999).
However, no existing studies have explicitly
examined the cost of uncertainty in a collegetown housing market. Rather, previous empirical studies on college-town housing in the
context of economics have focused mostly on
how the presence of a campus inﬂuences the
surrounding housing property values. Vandegrift, Lockshiss, and Lahr (2009), for example,
found that the presence of a college in a municipality in the state of New Jersey resulted in
an increase in housing prices of about 11% and
that the appreciation rate was larger as the size
of the college became smaller. Using housing
data in the state of Ohio, Johnson (2008) found
84

that the housing price appreciated around colleges that had graduate and bachelor of music
programs. These studies imply that the presence of a college may have a positive inﬂuence
on the neighborhood, resulting in the appreciation of housing values.4
Although few studies on the college-town
housing market have been published in the
ﬁeld of economics, some studies investigating the issue may be found in other ﬁelds,
such as sociology and law. Wenner (1999), for
example, speciﬁcally studied the case of Ithaca,
New York, where the rental housing market experienced a crisis caused by a shortage in the
housing supply, a monopolistically competitive
housing market, and disorganized forms of
lease contracts. Wenner proposed that property
owners follow a certain format in their lease
contracts so that the information they provided
would be clear to renters and thus help alleviate rental problems. Gumprecht (2003) provided one of the most comprehensive studies
clarifying various aspects and characteristics
of the college-town environment. He noted
that college towns primarily have a concentric
structure, a high rate of rental housing, and
less heterogeneity among residents (because
of their association with the university). This
enables researchers to control for the characteristics of the town and the housing market
and thereby observe the pure effects of the
issue of interest. In our analysis, for instance,
university housing can be regarded as an
almost risk-free good against uncertainty in
the housing market. In contrast, the cost of
4
Also see Fields (2011) and Kashian (2009) for estimations of
hedonic housing price functions in college towns. Both authors
found a negative correlation between the rental price and the
distance from the campus to student housing.

THE JOURNAL OF COLLEGE AND UNIVERSITY STUDENT HOUSING

The Journal of College and University Student Housing - Volume 41, No. 2 & Volume 42, No. 1

Table of Contents for the Digital Edition of The Journal of College and University Student Housing - Volume 41, No. 2 & Volume 42, No. 1