Small College Towns Face Economic Hardship After School Closures

The United States is projected to experience a shrinking population of 18-year-olds annually starting in 2026, a demographic shift expected to significantly impact college enrollment, particularly for small, regional private universities. This trend has already led to approximately 150 colleges and universities closing, merging, or consolidating since 2016, according to data compiled by Higher Ed Dive. Financial difficulties and declining student numbers have been cited as primary reasons for these closures. The cessation of operations by these institutions can have profound effects on the surrounding towns that depend on the consistent influx of students and the jobs associated with the university. While colleges situated near large urban centers, such as Newbury College in Boston, which closed in 2019 with around 600 students, may have a negligible impact on the local housing market, institutions in smaller, more isolated communities can leave a substantial void in both the local economy and housing sector when they cease to exist. To investigate the potential consequences of future university closures, Realtor.com® conducted an analysis of three former college towns: Cazenovia, New York; Ashland, Wisconsin; and Laurinburg, North Carolina, to assess the impact on their respective housing markets. Cazenovia College, located in Central New York, closed its doors in 2023. The town of Cazenovia is characterized by its lakeside setting and appealing community atmosphere, drawing individuals seeking an escape from urban life. Real estate broker Michael DeRosa described Cazenovia as a desirable market with a shortage of available homes, noting that "Cazenovia's greatest luxury is the quality of everyday life. The lake draws people in, and the village makes them want to stay." He further elaborated that the combination of water, countryside, and a charming village contributes to its appeal. The median listing price in Cazenovia stands at $470,000, with homes spending an average of 52 days on the market, a figure slightly below the national average of 60 days. The closure of Cazenovia College, which had been in operation for nearly a century, has presented challenges for the town. The economic ripple effects of a college closure extend beyond housing, impacting local businesses, employment rates, and the overall vibrancy of the community. Towns that have historically relied on the university for a significant portion of their economic activity often struggle to diversify their economies and attract new industries or residents after the institution's departure. The long-term outlook for such towns often depends on their ability to adapt and find new sources of economic growth and community engagement in the absence of their primary anchor institution. The trend of declining enrollment and subsequent college closures is expected to continue, making the study of these former college towns crucial for understanding and mitigating the future economic and social impacts on similar communities across the nation.