Few real estate rental markets can extend the sort of steady demand for rental homes like a college town. However, there is so much to learn before resolving to invest in rental property in these areas. No two college towns are exactly alike, and different types of institutions will influence an owner’s ability to competitively lease off-campus housing. Though with constant demand and the tendency to appreciate well, investing in one or more rental homes close to a college or university can be an effective way to achieve your long-term financial goals.
Around the United States, each college city has one thing in common: the students, faculty, and staff who live there all want housing close to campus. Such a demand can make buying an investment property in a college town seem like an attractive option. Although this is frequently the circumstance, there are some things to contemplate before beginning your property search.
For example, it may be wise to research the campus and its surrounding community before choosing one community over another. Collecting facts on enrollment history, the projected growth of the school, current and projected ratio of students to on-campus housing, and any planned developments can help you estimate the current and future potential of any given neighborhood. Supposing a school has shrinking enrollments or is opening a second campus in another community, both could initiate a sharp decrease in demand for off-campus housing. Findings like this are essential to possess before investing in any university community.
Another critical piece of information is the type of institution that is at the core of the town or city. Private universities and colleges may have strict housing policies and more on-campus housing available, thereby reducing the need for off-campus options. Public universities, alternatively, may have less on-campus housing when combined with the number of students attending but may have a high percentage of local, part-time, or commuting students who do not require or need a house close to campus. These are all matters you must do your best to consider before opting whether to get a rental property in a college town.
It is also crucial to evaluate the area’s available investment properties to ensure that any potential options have features commonly found in profitable rentals. The condition of the house and its adjacent vicinity are among the most essential components. Crime rates, amenities, age of the house, and most recent updates will all alter your potential to attract tenants and charge a competitive rental rate. Another pivotal factor is understanding the tax implications of your purchase. The amount of property tax, both current and future, must be included in the cost of owning the property, as must any required homeowners’ association fees. You should also inspect for any restrictive codes or laws that might prohibit you from renting out the property; each city and town has its own set of regulations that can vary widely from place to place.
In case your investigation is looking promising and you are looking to begin acquiring real estate in your preferred area, you can significantly narrow down your search parameters if you decide early on how much you desire to spend, how much risk you can comfortably assume, and how much time you have to devote to property management. Managing a rental property is a considerable undertaking for your time, especially if you are planning to perform nearly all of it yourself. Rental homes in college towns are somewhat unique in that they tend to have a high rate of turnover. If students are your target demographic, it’s urgent to comprehend that there will be a lot more tasks immersed in marketing, screening, and leasing your property from year to year, perhaps even semester to semester. Meanwhile, if you want to rent to graduate students or faculty, you will need to know how to market your rental effectively to attract them to your property.
Regardless of who your target renter is, it is vital to be honest about your ability to perform consistent and high-quality property oversight and maintenance. Property management can be a hands-on responsibility, one that requires round-the-clock handiness should an emergency occur. If you want to administer a property yourself, you are also confined to areas that you can penetrate rapidly or frequently, commonly these are places that are adjacent to your hometown.
The substitute for doing it yourself is to appoint a worthy property management company to manage your property for you. There are valid upsides to doing so, particularly if you are planning to rent to students. Placing ads, interviewing renters, showing your property, performing routine maintenance, handling move-in, and move-out efficiently – all of these can be turned over to a team of professionals dedicated to protecting the value of your investment property. What is more, if you prefer a national brand like Real Property Management Prosperity, you are not limited to buying in your home market. Your investment options are boundless because of a network of reliable property management franchise offices coast to coast.
At Real Property Management Prosperity we can help property investors like you decide if obtaining one or more rental properties in a college town fits. We have market data and industry experts who can provide the information you need to make the best possible decision. Contact us today for more information.
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