Few real estate rental markets can provide the kind of consistent demand for rental homes seen in a college town. However, every college town is different, and various sorts of institutions will influence an owner’s potential to lease off-campus housing competitively.
Around the United States, every college city has one thing in common: the students, faculty, and staff who live there all need housing close to campus. Such steady demand can make buying an investment property in a college town interesting. Although this is usually the scenario, there are certain significant considerations before starting your property search.
Learn about the local university or college
For illustration, it may be advisable to research the campus and surrounding community before deciding on one town over another. Compiling data on enrollment history, the school’s projected growth, the current and projected ratio of students to on-campus housing, and any planned developments can help you estimate any given area’s current and future potential.
The type of institution that is at the core of the town or city also has great significance. Private universities and colleges may have strict housing policies and more on-campus housing available, reducing the need for off-campus options. Public universities, on the other hand, might have less on-campus housing when compared to the number of students attending but may have a high percentage of local, part-time, or commuting students who do not need or want to house close to campus.
Understand the college town’s real estate market
It is equally essential to estimate 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 the surrounding neighborhood are among the most vital variables.
Your ability to attract tenants and charge a competitive rental rate will depend on crime rates, features, the house’s age, most recent developments, etc. Another crucial factor is recognizing the tax implications of your purchase.
The current and future property tax amount should be factored into the cost of the house, as must any required homeowners’ association fees. You should also inspect any restrictive codes or laws that might prohibit you from renting out the property; every city and town has its own set of regulations that can vary widely from place to place.
Create an investment and management plan
If your study is favorable and you choose to go forward with a real estate purchase in a college town, you can substantially reduce your search parameters if you determine right away how much you want to spend, how much risk you can comfortably assume, and how much time you have to offer to property management.
Owning a rental property requires a great deal of time, particularly if you intend to perform much of it yourself. Rental homes in college towns are special in that they have a high rate of turnover. If students are your target demographic, you should be mindful that marketing, screening, and leasing your property will take a lot of work from year to year, perhaps even semester to semester.
Hire a professional property manager
Hiring a quality property management company to manage your property is another option than doing it yourself. Substantial rewards abound from doing this, particularly if you want to rent to students. Placing ads, interviewing renters, presenting your property, conducting frequent maintenance, and handling tenant turnover can all be rerouted to a team devoted to protecting your investment property’s value.
Here at Real Property Management Providence, we assist Providence property investors such as yourself in determining whether it makes sense to consider one or more rental properties in a given area. Our market data and industry expertise can supply the information required to guide your decision-making to the best results. Contact us today or call 401-272-3300 for more information.
Originally Published on October 4, 2019
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