For a number of reasons college town property has been an attractive investment object for a long time. This article will dwell on some of these reasons, and help you avoid some of the common pitfalls associated with college town property investing.
Reasons to Invest in College Town Real estate
The most important reason why you should invest in college town is the enormous number of prospective tenants, a lot of which are college students, most of whom are looking for a long term place to stay. As you probably know, the majority of colleges are unable to cover the housing needs of their students. We suggest you do a research on the situation with off campus hosing in different cities before you jump to make any decisions.
A good thing about renting out to students is that you will be able to rent out every room you have. If the property you invested in is larger than a student might need, chances are you won’t find anyone willing to pay $2,500 a month, while 5 tenants will have no problem to pay $500 each.
Even though students are the most obvious tenants in college towns, statistics show that college towns consist of highly educated populations, being the reason why many businesses flock there. All these businesses employ a great deal of specialists, who also have housing needs.
The third category of people inhabiting college towns is retirees and there is nothing weird in that. College towns have a lot of sporting and cultural activities making them a great place to enjoy retirement, especially given the affordable cost of living.
Stable Demand for Real Estate
The real estate market in college towns is usually focused on the college, which is far less influenced by economic dips. As a rule, college students are unemployed, so they won’t lose their job. Because of the value of education in our culture, the numbers of students in colleges grows every year.
Tips on Investing in College Towns
1. Should you decide to rent out your real estate to students, consider the occasional parties, which are inevitable.
2. Another point to think of is the distance from school. The location of your property will most probably define the category of your potential tenants.
3. Consider the possibility of using your IRA as a way to invest in college town real estate. Look into self-directed IRAs which can be a great opportunity for you.