September 25, 2014

Cost of College Room and Board over Time - 1971 to 2013

I got the room and board costs off the College Boards site page for published prices at national level.  Specifically the Tuition and Fee and Room and Board Charges over time table 2.

I had to figure the room and board cost by taking the total cost for tuition, fees and room and board and subtracting the cost for just tuition and fees since they didn't have an individual figure for just room and board.

I'm showing the numbers for public four year universities here.   However I looked at private schools and the trend is pretty much the same but private school room and board costs a bit more.

Here's a chart showing the trend for room & board and tuition rates over the past 43 years :

From the chart it looks like the growth rate has been similar, but not really.   Tuition started at $428 a year in 1971 and housing was $977.   Now as of 2013 school year tuition hit $8893 and room and board was $9498.    Tuition is 20 times as much and room & board is not quite 10 times as much. 

Here's the compound annual growth rates for the entire period and the latest 20 years :

Tuition Room/board
1971-2013 7.50% 5.60%
1993-2013 6.50% 4.90%

Again that doesn't look hugely different but 7% growth adds up a lot more over the years than 5% does.

Room and board has gone up faster than inflation but not as fast as tuition.

A large portion of the cost of room and board is the real estate.    You might have noticed that housing has gone up in the past few decades and even with the crash a few years ago real estate has grown faster than inflation over the past 40-50 years.    We can look at housing costs two ways, comparing to the cost of rent or the cost of housing.   I got both from the Census for the 1970, 1980, 1990 and 2000 years.   Historical housing cost and rent cost.  Unfortunately the college room and board figures only go back to 1971 so I'm comparing hosing costs from 1970 to room and board from 1971.  Close enough for an idea but not exact.

Room/board Rent House
1971/70 $977 $1,296 $17,000
1980 $1,747 $2,916 $47,200
1990 $3,166 $5,364 $79,100
2000 $4,931 $7,224 $119,600

With the following growth rates for the 30, 20 and 10 year periods :

Room/board Rent House
70's to 2000 4.2% 4.4% 5.0%
80 to 2000 5.3% 4.6% 4.8%
90 to 2000 4.5% 3.0% 4.2%

Generally the cost of room and board has grown at a similar pace as rent and home values.    Over the longer period from 1970/1971 to 2000 the cost of room and board at 4.2% has not grown as fast as either rent at 4.4% or homes at 5%.    Of course a sizable % of the cost of room and board is in the food served to students.   However I don't know what % of the cost is typically housing and what % is food, so I can't break that apart.

 Bottom Line:    Room and board has certainly gone up over the decades and faster than inflation in general.  However it hasn't gone up as fast as tuition and the growth in room and board has been more on pace with the change in housing costs.


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