The level of consistent demand for rental homes in a college town is quite unique and can only be found in a limited number of rental real estate markets. However, every college town is different, and the capability of owners to lease off-campus housing competitively will be influenced by the different types of institutions that are located there.
Across 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 inviting. While this is typically the instance, there are a few crucial considerations before starting your property search.
Learn about the local university or college
For example, prior to choosing a specific city over another, it can be helpful to research the campus and surrounding community. Acquiring 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 analyze the current and future potential of a given area.
Another important factor 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, which lessens the requirement for off-campus options. On the contrary, public universities may have a lower number of on-campus housing options in relation to the number of students attending, but they may have an increased number of local, part-time, or commuting students who do not need or desire to house close to campus.
Understand the college town’s real estate market
It is equally important to take a close look at 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 crucial considerations.
The ability to attract tenants and impose a competitive rental rate can be determined by factors like crime rates, amenities, the house’s state, and most recent improvements. Acknowledging the tax implications of your purchase is another important aspect to take into consideration.
The current and future property tax amount must be added to the property’s cost, alongside any required homeowners’ association fees. It is also important to learn 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 differ significantly from place to place.
Create an investment and management plan
If your research yields satisfactory outcomes and you opt to continue with a real estate purchase in a college town, reducing your search options can be made easier by promptly determining how much you want to spend, how much risk you can comfortably assume, and how much time you have to invest to property management.
Owning a rental property can be quite challenging, especially if you like to perform most of the responsibilities alone. There is a high rate of turnover in rental homes in college towns, which sets them apart from other kinds of housing. If students are your target demographic, it is vital to consider the effort required in marketing, screening, and leasing your property on a yearly basis and possibly even from semester to semester.
Hire a professional property manager
If you prefer not to handle it yourself, you can always consider hiring a quality property management company to manage your property. There are numerous benefits to doing so, primarily if you want to rent to students. Publishing advertisements, screening renters, showcasing your property, executing regular maintenance, and handling tenant turnover can all be entrusted to a team focused on protecting your investment property’s value.
At Real Property Management Reliance, we help Gloucester property investors like you in determining the feasibility of investing in one or more rental properties in a particular location. We can provide you with the information you need to make well-informed decisions, thanks to our access to market information and industry experts. Contact us today or call 978-998-8114 for extra information.
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.
