Few real estate rental markets can provide the level of consistent demand for rental homes that frequently appear in a college town. Nevertheless, every college town has distinct characteristics, and various types of educational institutions will impact a landlord’s capacity 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. Such steady demand can make buying an investment property in a college town tempting. Although this is frequently true, there are several crucial considerations before starting your property search.
Learn about the local university or college
For example, it is recommended to research the campus and surrounding community before picking one town over another. Obtaining 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 assist you in determining any given area’s current and future potential.
Another crucial factor to consider 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, lowering the necessity for off-campus options. Conversely, public universities may have a lower on-campus housing in contrast to the number of students attending, but they may have a significant percentage of local, part-time, or commuting students who do not require or prefer to live house close to campus.
Understand the college town’s real estate market
It is critical 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 among the most essential components.
Factors such as instances of crime, infrastructures, the house’s age, and most recent upgrades will all affect your ability to attract tenants and set a competitive rental rate. Another crucial factor to consider is comprehending the tax implications of your transactions.
The current and future property tax amount must be incorporated in the property’s pricing, as must any required homeowners’ association fees. It is advisable to additionally verify the presence 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 might differ significantly from place to place.
Create an investment and management plan
If your research yields positive results and you choose to proceed with a real estate purchase in a college town, you can substantially decrease the scope of your search by determining in advance how much you want to spend, how much risk you can comfortably assume, and how much time you have to allocate to property management.
Owning a rental property entails a significant dedication of time, particularly if you intend to handle the majority of tasks independently. Rental homes in college towns are unique in that they have a high rate of turnover. If students are your target demographic, it’s crucial to comprehend that a substantial amount of additional effort will be required in the marketing, screening, and leasing of your property on an annual or even semesterly basis.
Hire a professional property manager
If you choose not to handle the task yourself, you have the option of hiring a quality property management company to manage your property. Engaging in this activity yields tangible advantages, particularly if your intention is to rent to students. By delegating tasks such as advertising, renters screening, property tours, regular maintenance, and handling tenant turnover to a dedicated team, you can effectively protect your investment property’s value.
At Real Property Management Pocatello, we assist property investors in Pocatello in determining the feasibility of investing in one or several rental properties in a specific area. Our organization possesses comprehensive market data and industry professionals who are capable of furnishing you with the necessary knowledge to facilitate optimal decision-making. Contact us today or call 208-234-1000 for extra information.
Originally Published on October 4, 2019
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