College towns are known for their strong and consistent demand for rental homes in the real estate market. Nevertheless, every college town has unique features of its own, and the type of institution present will impact an owner’s capacity to lease off-campus housing competitively.
Around 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. Although it is frequently true, there are several crucial considerations before starting your property search.
Learn about the local university or college
For example, it may be wise to research the campus and surrounding community before making a decision between different towns. Collecting details 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 calculate any given area’s current and future potential.
A further essential aspect 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 necessity for off-campus options. On the other side, public universities may offer fewer on-campus housing when compared to the number of students attending. However, they often attract a significant number of local, part-time, or commuting students who do not need or want to house close to campus.
Understand the college town’s real estate market
It is equally essential to determine 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 of utmost importance.
Factors such as crime rates, amenities, the house’s age, and the latest renovations may all influence your ability to attract tenants and demand a competitive rental rate. Another important factor is recognizing the tax implications of your purchase.
The current and future property tax amount must be included in the property’s cost, as must any required homeowners’ association fees. You should also be aware of 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 beneficial outcomes and you choose to proceed with a real estate purchase in a college town, you can streamline your search by determining early on 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 calls for a significant amount of time, particularly if you want to perform most of it yourself. Rental homes in college towns are experiencing a significant amount of turnover due to the nature of their rental market. If students are your target demographic, it’s important to recognize that there will be a significant amount of effort needed in marketing, screening, and leasing your property from year to year, perhaps even semester to semester.
Hire a professional property manager
Consider hiring a quality property management company to manage your property instead of attempting to do it yourself. There are significant advantages to doing this, primarily if you are planning to rent to students. Placing ads, interviewing renters, showing your property, performing routine maintenance, and handling tenant turnover can all be diverted to a team dedicated to protecting your investment property’s value.
At Real Property Management Meridian, we help Fort Worth property investors like you choose if considering one or more rental properties in a particular area makes sense. We have a wealth of market data and industry professionals at your disposal, ready to provide you with the information necessary to make the most informed decisions. Contact us today or call 817-678-8787 for more data.
Originally Published on October 4, 2019
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