There is a consistent demand for rental homes in a college town that you can’t find in many other places. But every college town is different, the ability of owners to lease off-campus housing competitively will depend on the various types of institutions.
Throughout 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. Because of this steady demand, it may be a good idea to buy an investment property in a college town. Even though this is often the circumstance, there are certain crucial considerations before starting your property search.
Learn about the local university or college
For instance, before picking one town over another, it may be smart to research the campus and surrounding community. Acquiring information 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 assess any given area’s current and future potential.
Another significant 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, decreasing the demand for off-campus options. Public universities, on the other hand, might have less on-campus housing when compared to the number of students attending but may have a lot of local, part-time, or commuter students who do not require or wish to house close to campus.
Understand the college town’s real estate market
It is additionally vital to look at the area’s available investment properties to ensure that any potential options have features commonly found in profitable rentals. One of the important things is the condition of the house and the surrounding neighborhood.
The incidence of crime, the house’s age, the features it has, and the most recent changes will all affect your ability to attract tenants and charge a competitive rental rate. Another important thing is to know the tax implications of your purchase.
The current and future property tax amount must be added to the property’s cost, as must any required homeowners’ association fees. You ought to also determine if there are 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 broadly from place to place.
Create an investment and management plan
If your investigation is boosting and you choose to go ahead with a real estate purchase in a college town, you can greatly narrow your search if you figure out beforehand how much you want to spend, how much risk you can comfortably assume, and how long you have to dedicate to property management.
Owning a rental property is a serious time commitment, especially if you plan to do most of it yourself. Rental homes in college towns are unique in that they have a high rate of turnover. If students are your target demographic, it’s essential to understand that a lot more work will be involved in marketing, screening, and leasing your property from year to year, perhaps even semester to semester.
Hire a professional property manager
You could also hire a quality property management company to manage your property instead of doing it yourself. It is a good idea to do this, mainly if you want to rent to students. A team dedicated to protecting your investment property’s value can take over tasks like posting ads, evaluating renters, displaying your property, accomplishing regular maintenance, and handling tenant turnover.
At Real Property Management Silverstone, we help Rochester Hills property investors like you figure out if it makes sense to look at one or more rental homes in a certain area. We can give you the market facts and advice from experts in the field that you need to make the best decision. Contact us today or call 586-992-6419 to find out more.
Originally Published on October 4, 2019
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