Student Apartment Hunting
Every year, millions of college students flood into college cities and towns. Those students, along with the faculty and staff at their schools, have one common need: housing. Consistent demand for housing makes college and university communities attractive to people interested in real estate investing. Read on to find out if it is an investment option that you should consider.
Whereas housing demand may fluctuate in other areas, college towns boast a steady flow of students, professors and staff, and a percentage of those will always require off-campus housing. Most colleges and universities do not have enough on-campus housing to satisfy demand, and when school budgets are tight, maintaining and upgrading housing can take a back seat to other financial priorities. Properties that are well-maintained, well-marketed, competitively priced and close to amenities can attract buyers and renters alike.
Once you have narrowed your investment options, there may be several areas available to choose from. Decide how physically close you want to be to a potential investment property and then draw a “radius” surrounding one or more colleges where you are interested in investing. Do some research and consider the following questions:
Is the school opening a new campus in a nearby community?
Is the school planning to build additional academic buildings and/or add programs of study to expand enrollment?
Is the campus diminishing in size? If a school is shrinking in size, either the student enrollment is dropping off or the school is considering dropping programs due to lack of funding. If you are prepared to become a long-term investor, you may be able to find a reasonably priced property with the potential for long-term value in a declining market.
As you evaluate your options, keep in mind that private schools tend to have strict housing policies, lower enrollments and lower student-to-on-campus housing unit ratios; therefore, there may not be as much demand for off-campus housing as in a community with a public college or university. In addition, there are significant differences in the housing needs of students attending school in a city versus a suburban or rural area. For example, urban and suburban schools tend to attract a higher percentage of commuting or part-time students who may not need housing.
College and university towns offer attractive options for real estate investors. If you are the parent of a soon-to-be college student, if you are nearing retirement and considering a future move, or if you would like to expand your investment portfolio, consider exploring your options in these areas.