Dorm or Deed? 23 Universities Where Buying a House is Cheaper Than Room and Board

Key Findings:

• Buying a home for a college student is more affordable than paying for room and board at 23 of the 121 universities and colleges analyzed.

• At Temple University in Philadelphia, buying a home could save $30,000 compared to paying room and board over three years and could yield a $70,000 profit in 10 years.

• The highest 3-year cost for room and board was $68,358 at New York University. Room and board is still $34,000 cheaper due to New York City’s high home prices.

• Marshall University in Huntington, W.V. offers the lowest average home price at $137,909. Parents might come out $19,000 ahead by purchasing a home versus paying room and board.

As summer winds down, the parents of countless incoming college freshmen will start pumping tens of thousands of dollars into their student’s dorm and dining plan. That means loft beds, mini-fridges and mac-and-cheese Mondays, while Mom and Dad get nothing but a dwindling bank account.

Hold that check.

What if instead of paying for twin XL beds and overpriced cafeteria burritos, parents bought a home near campus? Their college-bound kid gets a roof, kitchen and groceries. Parents acquire a property that could pay dividends long after cap and gown season.

Sound like an elective worth enrolling in?

Mortgage Research Network analyzed home prices near 121 colleges and universities and found that at 23 schools, buying a house beats dorm life, financially speaking.

Here’s the calculation:

How We Calculated Homeownership Costs

Our analysis looked at the total cost of owning an average-priced home in each school’s city, including the mortgage payment, property taxes, mortgage insurance, homeowners insurance, closing costs and maintenance. The study factored in grocery expenses, considering students would not have a school meal plan.

Estimated rental income (say, from roommates) and expected home appreciation were subtracted from total ownership costs. That left a net cost of owning a home, which was then compared to each school’s published room and board expenses over three years.

What about students who don’t live on campus the entire time? According to the National Center for Education Statistics (NCES), students living off-campus in an apartment or house typically spend about the same as those on-campus. To keep things consistent, the study used each school's published room and board figures as a stand-in for both on- and off-campus living costs.

One important note: The 10% down payment wasn’t treated as a true expense. That’s because, in most cases, a homeowner gets that money back when they sell—assuming home prices don’t drop significantly.

The Results: Room and Board Isn't the Best Investment

Schools like Temple University, Marshall University and the University of Delaware received an A+. Parents net up to $30,000 over three years. How’s that for a graduation gift? (Calculations were based on three years, not four, since some institutions encourage freshmen to live on campus and 22% of freshmen drop out after their first year, say EducationData.org.)

Plan to hang onto the home for a decade? Those profits could soar to $70,000, earning parents high honors for their off-campus acumen.

Bottom line: In some markets, investing in a home isn’t just smart parenting – it’s advanced real estate strategy.

5 Best Schools to Buy a Home vs Room & Board

These schools are located near affordable housing markets, yet require average to above-average costs for room and board.

• Temple University in Philadelphia: +$29,742 when buying versus paying room and board

• Marshall University in Huntington, W.V.: +$18,805

• University of Delaware in Newark: +$16,696

• University of Alabama in Tuscaloosa: +$16,353

• University of Memphis in Tennessee: +$15,171

5 Schools Where Buying Doesn’t Pencil Out

Room and board is no bargain at these schools, requiring a $50,000 price tag over three years. But what makes dorm life comparitively cheaper is area home prices, which eclipse $1 million in three of the five following markets:

• University of Washington in Seattle: -$83,100 loss when buying compared to room and board

• University of California in San Diego: -$91,339

• California State University in Fullerton: -$98,483

• University of Colorado in Boulder: -$101,564

• Montclair State University in Montclair, N.J.: -$163,979

At these schools, parents who buy a house instead of paying room and board could lose up to $163,000 over three years, as is the case for Montclair State University in Montclair, N.J., where the average home prices is $1.1 million and the total cost to own is nearly $10,000 per month.

23 Schools Where Buying a Home For a College Student is Cheaper than Room and Board

The following list shows 23 universities where parents might break even or make a profit buying a house for their college student over three years. The full list of 121 schools analyzed can be found at the end of the study.

Housing Is Expensive In All Forms. Just One Offers a Return

Parents of college-bound students often assume tuition will be the biggest expense.

However, according to the National Center for Education Statistics (NCES), students at four-year, in-state public universities paid an average of $9,834 in tuition during the 2022–23 school year, which is the most recent data available. In contrast, on-campus room and board costs $12,302, making housing and food the most significant financial burden.

Living off campus isn’t necessarily a cheaper alternative. NCES data shows that students who rent off campus and don’t live with family save only about $300 per year, a modest reduction that doesn’t substantially offset overall costs.

Unless a student lives at home or with relatives, housing and food will remain major expenses throughout college. The key difference with homeownership is the potential for a return on investment. While rent and college housing provide no financial return, buying a home could build equity over time.

How To Make College Homebuying Pencil Out In Your Favor

Investing in real estate could yield a return, unlike room and board.

But there’s a strategy to it. Parents can end up losing money, too. Here’s how to make it work:

• Low home prices: Consider buying near schools with high room and board costs but low area home prices.

• Taxes and insurance: High tax and insurance rates can eat away at profits. For example, near the University of Illinois in Champaign, Ill., a tax and insurance bill of $576 monthly makes owning unprofitable after the three-year mark.

• Appreciation: Research local appreciation rates. Don’t buy in declining areas.

• Rental market: Our study assumed two roommates living with the student to offset part of the mortgage payment. Ensure a strong student rental market and plan to rent it out after the student graduates.

Perhaps most important, apply for the loan as a “non-occupant co-borrower” and make the student the primary borrower. The student may need a credit score, but they don’t need their own down payment or income. A non-occupying parent can qualify using their income but receives owner-occupied mortgage rates since the child plans to live in the property. Buying the home as an investment property is sure to be prohibitively expensive.

Becoming a Landlord

One factor might scare off would-be college town homeowners: becoming a landlord.

The study assumed two roommates in the home during the student’s stay, paying a combined two-thirds of the area’s market rent. Rental income partially offsets the mortgage payment and is key to making the investment worthwhile.

For example, at Louisiana State University, the total monthly cost of ownership is estimated at $1,849. Two roommates pay a combined two-thirds of the area’s average rent, bringing in $930 per month. This income reduces the real cost of ownership to around $900 per month.

Some parents, though, may be averse to landlording. They might buy a home solely for the potential appreciation. That eliminates the headache, but cuts into their chances of saving on college costs.

College Town Owning: Shorten the Student’s Homeownership Journey by a Decade

There’s no right answer for all parents of college students. Each parent and student should analyze the real estate market in which the student will be studying.

The student will need to bear some responsibility as well, such as taking care of the property to make sure it’s will be viable for continued rent or a sale after graduation.

Despite dozens of factors to consider, one thing is certain: savvy parents and college students can come out way ahead by skipping room and board. Mortgage Research Network recently performed a study on how long it might take a college student to buy a home on their own after graduation. The answer: nearly 10 years.

Buying a home instead of paying room and board is sure to be less convenient. But it could give the student a decade or more head start in their homeownership journey.

Full List of 121 Colleges and Universities Analyzed

Methodology and Sources

• Defined “worthwhile to buy” as when the buyer breaks even or makes a profit after three years.

• Schools considered: Top three schools per state by undergrad enrollment. Removed colleges where city home values, room and board fees, or rental data was not available. 121 schools remaining.

• We assumed a 3-year outlook, as many schools encourage freshmen to live on campus. Additionally, homebuying is risky when 22% of freshmen drop out, says EducationData.org. We also ran 5- & 10-year outlooks.

• We did not include a down payment as a cost since the buyer would get it back upon selling the home (subject to home value risks, as is true with any investment). Putting up an initial principal payment is similar to how someone would invest in stocks or other investments, as the investor intends to receive their principal back with interest upon exiting.

• Monthly costs to own assumed:

  • Home prices from Zillow ZHVI All Homes Time Series Smoothed, Seasonally Adjusted, June 2025

  • Principal and interest based on a 10%-down conventional loan at 6.714%, the 30-day average conventional loan rate from Optimal Blue.

  • PMI from MGIC

  • Homeowners insurance rates on a $300k structure by state from Nerdwallet

  • Average state taxes from TaxFoundation.org

  • 1% annual maintenance costs

  • One-time estimated closing cost fee of 2% of the mortgage amount.

  • Subtracted estimated appreciation from costs to own at 2.8% of the home price per year (63-year average per U.S. Census Bureau; U.S. Department of Housing and Urban Development via FRED®). Local appreciation rates were not used, as the data for most markets does not go back more than 10 years, a period with very high home appreciation rates that might skew estimates for future home value increases.

  • Subtracted projected rental income based on ZORI Zillow Observed Rent Index Smoothed All Homes Plus Multifamily Time Series by City

    • 3-year outlook: Assumed two roommates during the 3-year stay and 67% of the city's average rent as rental income

    • 5-year outlook: Assumes 67% of the city’s average rent as rental income for the first 3 years and 100% for the remaining 2 years after the student's departure.

    • 10-year outlook: Assumes 67% of the city’s average rent as rental income for the first 3 years and 100% for the remaining 7 years after the student's departure.

• We added off-campus food costs as part of homeownership costs. We used USDA's "Thrifty Food Plan" May 2025, average of single man ($309.80/mo) and single woman ($247.80/mo) age 20-50 + 5% for 3 person household (student plus 2 roommates) per USDA methodology. Avg $278.80 + 5% = $292.74/mo. Does not include eating out, since a student with an on-campus meal plan would likely eat out as well.

• No annual increase was considered for homeowners insurance, taxes, rental rates, or room and board costs, since rate increases are difficult to predict for each housing market or school.

• Room and Board costs were obtained for each school from the Department of Education College Scorecard Data.