Few real estate rental markets can offer the kind of consistent demand for rental homes found in a college town. Yet, each college town has individual features, and different types of establishments will influence an owner’s capability to lease off-campus housing competitively.
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. This steady demand can make buying an investment property in a college town tempting. Although this is typically the scenario, there are a few key considerations before starting your property search.
Learn about the local university or college
For instance, it would be sensible to research the campus and surrounding community before choosing a particular city over another. Gathering 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 calculate the current and future potential of an area in question.
Another crucial factor to bear in mind 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, reducing the requirement for off-campus options. Public colleges, contrastingly, may have fewer on-campus housing units compared to the number of students attending, but they may have a considerable number of local, temporary, or commuting students who do not require or prefer to house close to campus.
Understand the college town’s real estate market
It is also important to analyze 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 aspects to take into account.
Factors such as criminal activity, the state of the house, infrastructure, and most recent enhancements can significantly influence your ability to attract tenants and set a competitive rental rate. Another crucial factor to take into account is knowing the tax implications of your transaction.
The current and future property tax amount should be incorporated in the property’s cost, in addition to any required homeowners’ association fees. Furthermore, it would be wise to examine any restrictive codes or laws that might prohibit you from renting out the property; each city and town has a particular set of regulations that can change widely from place to place.
Create an investment and management plan
If your investigation yields positive findings and you choose to continue with a real estate purchase in a college town, narrowing down your search parameters becomes much easier when you know how much you want to spend, how much risk you can comfortably assume, and how much time you must devote to property management.
Owning a rental property requires a significant investment of time, particularly if you plan on dealing with most of the work yourself. Rental homes in college towns are exceptional in that they have a high rate of turnover. If students are your target demographic, you must remember that marketing, screening, and leasing your property will necessitate a substantial amount of effort on a regular basis, potentially even on a semester-to-semester basis.
Hire a professional property manager
Another alternative to handling it on your own is hiring a quality property management company to manage your property. There are notable benefits of doing so, particularly if you intend to rent to students. Managing advertisements, conducting renter interviews, showcasing your property, completing routine upkeep, and handling tenant turnover can all be assigned to a dedicated team that prioritizes protecting your investment property’s value.
At Real Property Management Regions, we assist King George County property investors like you in evaluating the practicality of buying rental properties in a particular area. We provide market information and specialists in the field who can assist you in making a well-informed choice. Contact us immediately or call 804-491-3348 if you want to know more.
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.