Every college city across the United States have that one thing in common: the students, faculty, and staff who live there all desire housing close to campus. Such regular demand can make buying an investment property in a college town seem like an attractive option. Although this is usually the case, there are some still high factors to consider before starting your property search.
For instance, it may be wise to research the campus and surrounding community before settling down on one town over another. Accumulating as much information 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 area. If a school has shrinking enrollments or is opening a second campus in another community, both could trigger a sharp decrease in demand for off-campus housing. Information like this is crucial to own before investing in any university community.
Another way to look at it 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 house close to campus. These are all things you ought to do your best to find out before deciding whether to buy a rental property in a college town.
It is likewise vital 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 surrounding neighborhood are among the most important aspects. Crime rates, amenities, age of the house, and most recent updates will all affect your ability to attract tenants and charge a competitive rental rate. One other important 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 would any required homeowners’ association fees. You could also check 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 differ widely from place to place.
If your research looks promising, and you decide to push with a real estate purchase in your chosen location, you can significantly narrow your search parameters on the off chance you decide from the get-go how much you want to spend, how much risk you can comfortably assume, and how much time you have to devote to property management. Owning a rental property requires a great deal of your time, especially if you have plans to do most 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 important to understand that there will be a lot more work involved in marketing, screening, and leasing your property from year to year, perhaps even semester to semester. On the other hand, if you plan to rent to graduate students or faculty, you will need to understand how to market your rental effectively in order to attract them to your property.
Regardless of who your target renter is, it is important to be realistic about your ability to provide consistent and high-quality property oversight and maintenance. Property management can be a very practical livelihood, one that demands full-time availability in the event of an emergency. If you want to manage a property yourself, you are also restricted to areas that you can easily go to at any given time, often relatively close to your own hometown.
The other way of doing it yourself is to employ a quality property management company to manage your property for you. There are certain perks 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 Northern Utah, you are not limited to buying in your home market. Your investment options are wide open with the help of a network of reliable property management franchise offices coast to coast.
At Real Property Management Northern Utah, we can help property investors like you decide if buying one or more rental properties in a college town makes sense. We have market data and industry experts who can give the information you need to make the best probable decision. Contact us today for more details.