This paper estimates the capitalization of school district consolidation into housing prices in New York State between 1990 and 2000. We utilize first differencing and 2SLS to account for district heterogeneity and possible endogeneity of the consolidation decision. We find that consolidation boosted house values and rents by about 25 percent in very small school districts and that this effect declines with district enrollment, as expected based on economies of size. Consolidation has no impact on housing prices in districts with more than about 1,700 pupils. The impact of consolidation on housing prices declines with tract house value and rent and is negative in the highest–price tracts.