Few real estate rental markets can offer the same caliber of demand for rental homes like in a college town. But there is a lot to recognize before deciding to invest in a 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. But with a constant demand and a 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.
Across the United States, each college city has one thing in common: the students, faculty, and staff who reside there all need housing close to campus. Such unrelenting demand can make buying an investment property in a college town seem like an attractive option. While this is mostly the plight, there are some specific things to take note of before initiating your property search.
For example, it may be shrewd to research the campus and surrounding community before naming one metropolitan over another. Gathering particulars such as enrollment history, the projected growth of the school, the 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 community. If a school has shrinking enrollments or is opening a second campus in another community, both could introduce a sharp decrease in demand for off-campus housing. Statistics like these are significant to obtain before investing in any university community.
Another required aspect 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, in contrast, 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 rent a house close to campus. These are all things you should do your best to determine before determining whether to buy a rental property in a college town.
It is also important 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 the outlying area are among the most fundamental traits. Crime rates, amenities, age of the house, and most recent updates will all influence your ability to attract tenants and charge a competitive rental rate. Another vital feature 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 verify 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 entirely from place to place.
If the information you’ve gathered is promising and you planning to start with real estate procurement in your chosen locale, you can significantly narrow your search parameters if you set early on how much you want to spend, how much risk you can comfortably assume, and how much time you have to devote to property management. Operating a rental property is significant time heavy responsibility, especially if you are thinking of accomplishing the majority 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 imperative to notice that there will be considerably more work involved in marketing, screening, and leasing your property from year to year, perhaps even semester to semester. However, if you have every intention to rent to graduate students or faculty, you will need to recognize how to market your rental effectively to draw them to your property.
Regardless of who your target renter is, it is vital to be sensible about your abilities to provide consistent and high-quality property oversight and maintenance. Property management can be a very hands-on job, one that requires full-time reachability should an emergency arise. If you want to operate a property yourself, you are also limited to places that you can enter quickly or easily, locations close to your hometown.
Another option to completing it yourself is to designate a property management company to manage your property for you. There are legitimate benefits to doing so, especially 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 choose a national company like Real Property Management Providence, you are not limited to buying in your home market. Your investment options are indefinite with the aid of a network of reliable property management franchise offices coast to coast.
At Real Property Management Providence, we can assist property investors like you to figure out if picking up one or more rental properties in a college town makes financial sense. We have market data and industry experts who can yield the information you need to make the best doable decision. Contact us today for more information.
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