It Just Means More: An Analysis of the Effect Major College Football has on Surrounding College Town Home Values

Abstract

This paper examines the effects of college football success on the field and financially on the local home values within that same college city. This study explores the capitalization of team performance, winning percentage, national championships, revenue generated, and operating expense budgets into college city home values using a hedonic price model with city and time-fixed effects. College football is not meaningfully tied to housing value changes across that city. While a limited effect, the study finds that national championships decrease housing values, particularly in smaller cities. Similarly, significant team operating expenses in big cities lead to depreciation across the housing market. The overarching findings broadly support the existing literature on the importance of college football within these communities and provide a more nuanced understanding of this relationship beyond the local tourist economy, the fan bases, and other qualitative benefits. The findings serve as the precursor for future, more granular analysis that can uncover the true relationship (if any) between college football and home values. This paper’s findings have ramifications for policymakers, athletic departments, local community homeowners, first-time homebuyers, and real estate investors alike. This study lays the foundation for continued scholarly discussion regarding the link between college football and real estate markets.