2008 College applications surged. Nationally, more students than ever before—3.3 million—will graduate from high school this year, said David Hawkins of the National Association for College Admission Counseling. Two-thirds of the graduates are expected to seek some form of higher education. The trend is expected to plateau next year, then decline slightly. State Colleges/Universities have not kept up. How can you join this opportunity? Follow our "9 Tips for College/University Rental Investments."
- State colleges/universities not private schools: Private schools are usually smaller with more available on campus housing. Alumni endowments help fund campus building projects. We want the choice of a large school student population found more at State Colleges & Universities.
- Small cities, big towns: Avoid large metropolitan city populations; stay with low commuter schools. Large cities have fewer college-type rental opportunities based on the normal high cost of residential properties. This tends to push rental rates above what mom and dad can afford. Remember mom and dad are also going to be on the lease. They are your guarantee for payment.
- Large out-of-state student population: Out-of-state students can’t live at home with their parents. Their choice is to live on campus—which in most cases is only available for Freshman not for 2nd, 3rd and 4th year students—or large off-campus apartment complexes, small rentals or the Animal House. Don’t rent as an Animal House. Be the small, easy access to campus property.
- High student population: Look for a high population versus number of on-campus housing dorms and suites. Availability is easy to determine as all schools publish either written or online statements of the number of units available. The school will also suggest alternative housing solutions. More solutions from the school shows more opportunity for investors.
- High off-campus rental costs for student apartments/suites: A comparison of available properties can help you determine the viability of your potential investment. Current high off-campus rental costs will allow you to charge more for your property. An example is here in Charlotte, NC at UNCC, which has a high commuter population. 2-bed 2-bath condos start at about $500 per month, while in Columbia, SC at USC the same 2-bed 2-bath condo starts at $925 per month. Both cases do not include utilities.
- New construction or high end rehab versus older cheaper properties: Mom and dad want the best for their kids and are not afraid to pay for it within reason. The students expect to live like they do at home (microwave, dishwasher, disposal, high-speed internet ready, air conditioning, modern baths, parking). Older cheaper properties usually require constant maintenance and do not have the modern appliances without a big cost outlay by the owners. We tend to buy new properties directly from the builder.
- Easy commute to campus: Whether they are walking, driving, using the local or campus bus service, make sure that your students can get there safely without a lot of trouble. Safety is the biggest concern with off-campus living. What is between your rental property and campus? It is a wise decision to walk the neighborhood yourself. Would you want your own student walking through the same area to get to school?
- Part-time job opportunities: Many students work part-time, and buying properties near retail districts, hospitals, and downtown restaurants and offices can make a big impression on the student worker.
- High graduate school population: This is where you can find your long-term renters. These students have proven themselves are in for the long haul and will usually sign leases that cover the full term of their education—2 to 3 years—and will accept a nominal yearly increase. Look for med schools, law Schools…you get the point.
We have invested in student rentals for years. Our oldest daughter went out of state to the University of South Carolina. During our search to get her qualified for in-state tuition we found that owning rental property with her was the key. This in effect actually lowered our out-of-pocket room and board expenses tremendously. Rental properties may also offer the owners tax write-offs for depreciation and expenses. Please confer your accountant as to how or if this may apply to your investment situation).
Claim up to $26,000 per W2 Employee
- Billions of dollars in funding available
- Funds are available to U.S. Businesses NOW
- This is not a loan. These tax credits do not need to be repaid
And for more information on College Rental Investments and Off-Campus Housing log on to http://www.CollegeTowneProperties.com.