Investing in Student Housing

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As a broker for a large real estate company in Boulder, Colorado I learned the benefits of investing in student housing when my agents would tell me about their clients. Parents who would buy an area property, rent it out to the friends of their kids, and then sell it after their child graduated for a lot of profit. Many times their kids didn’t even need to pay any rent because it was covered by their friends renting rooms. And having a student with friends is better than any property management company when it comes to finding students looking for a place to live.

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(MSN– Data from US Census Bureau)

When investors call and want information on buying rental properties in the Salt Lake area, one of the first places I advise them to search is close to the University of Utah. Being close to the University gives them a higher probability of finding a renter.

Sure, college students can be tough on a property, but so can anyone. I’ve had renters who seemed like salt-of-the-earth people, but once moved in and comfortable began destroying the property with their lifestyle and poor judgement.

And it’s not only students who want to be close to the University. The energy and culture that surrounds the area attracts alumni and people who enjoy an active lifestyle. This includes families, you ng couples, single people, and out-of-state people who want the liberal atmosphere that usually comes with living close to U.

The Real Estate Bloggers write about this saying, “the market for student rentals tends to be recession proof as a college education is never going out of style.” Good point. The blog also direct us to a post from the LA Times, which says, “According to the National Center for Education Statistics, college enrollment will grow by 11% between 2003 and 2013. Higher education is less affected by economic trends. When times are bad, more people seek a college degree to improve the job prospects; when times are good, a sheepskin becomes even more important. Moreover, children of the baby boom generation are taking longer than their predecessors to graduate, so they need housing for a longer stretch.

Next, toss in the fact that rents for student-housing properties have been rising at a higher rate than at conventional apartments, according to the National Multi-Housing Council, and you have the makings for what savvy real estate investors call a “good niche opportunity.”

Carl Peppers writes more here

eHow offers tips on how to invest in student housing properties

Daily Californian writes Students Try to Find Housing-to Buy

MSN writes Student housing gets good investment grades

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16 thoughts on “Investing in Student Housing

  1. One of the advantages of renting to students is their willingness to rent property that is not in as good of condition, and when they properties are close to the University, often rents can be higher by renting by the room.

    A three bedroom house that has a market rent value of around $1200/month might be rented to three students, each paying $450/month for a room, which would bring in $1350. or $150/month more.

    Nothing is a sure thing, and the property needs to be one that has benefit for the sudents (proximity to school and restaurants, layout and extra bathrooms, etc). As in all types of investment, it is important to have a professional help you make good decisions, and you have to be willing to handle the risk, but student housing is a niche that has potential to bring a good return on your investment.

  2. Pingback: Real Central VA - Tracking the Charlottesville and Central VA real estate market and more » Friday links 02 March 2007

  3. Yes students can wreck the place a bit though so good rules need to be laid down. The best investments come in areas that are building up in terms of student numbers or new campuses.

    Bill

  4. This seems to be just another example of discrimination, of a national flavor. The author of this blog should warrant the accuracy of his information. To note at least one correction:

    The City of Bloomington, Indiana, has spent a significant portion of its annual budget on legal fees for William J. Beggs of the firm Bunger & Robertson fighting a civil rights lawsuit brought against it by Seth Patinkin, a prominent Jewish alumnus of Indiana University. Patinkin’s lawsuit alleges systematic anti-semitic discrimination to disrupt Patinkin’s real estate business in the town perpetrated by and among the ranks of many of the municipal officials.

    A few blogs which discuss this story include:

    http://markkruzan.blogspot.com
    http://patriciamulvihill.blogspot.com
    http://cityofbloomington.blogspot.com
    http://kevinrobling.blogspot.com

  5. Patinkin,

    I’m not sure if you actually read the post because there is no hint of discrimination anywhere in it.

    Just because you are caught up in lawsuits right now with your business partner about rental properties doesn’t mean everything mentioning rentals is discriminatory.

    Either you are simply trying to get some attention or you can’t read- either way you are wrong.

  6. I’m not sure why Patinkin brought up anything about the discrimination in this case. However, upon reading the case, the defendant apparently cited the following city legislation on rental properties in an attempt to ruin a real estate venture for anti-semitic reasons.

    “The City has used the Title 20 Zoning Ordinance (“Title 20”), a regulation that limits occupancy in certain non – grandfathered houses to three (3) unrelated adults, as a pretext to deprive Patinkin of his civil rights under law.”

    I would say that it does show that there is a degree of due diligence that should be pursued in taking on a venture such as this. I also believe it’s a wonderful way to invest for all of the reasons cited above. In fact if you do a little research on what college students want in a rental, it would be easy to cater to the market directly. It’s also a relatively easy market to target.

  7. Pingback: Investing in Student Housing | RateMyStudentRental Blog

  8. When i was in new york. The West Campus offers students a chance to live just a few blocks from campus, while enjoying all the freedoms of independent living. A perfect mix of a tranquil residential neighborhood bordering Ithaca’s Downtown and Cornell, West Campus has something for everyone. Shopping, campus and Cornell’s nightlife are all just minutes away from the West Campus.

  9. More students in present day are attending college than ever before, and schools all over are now offering student housing both on campus and near by. Student housing has become very beneficial especially for all of those incoming freshman. Socially and academically it is very beneficial if you find yoursself living in these situations. Student housing is a melting pot of culture.What better way to get to learn about other people’s beliefs and traditions than to live in and environment in which everyone one around you has freedom to express themselves. With more information on the ins and outs of student housing visit http://www.greystarstudentliving.com/

  10. Pingback: Selecting The Ideal University Student Lodging – A Rough Manual | internet article marketing, read articles online for free, blogging articles

  11. any opinion on privately owning a fraternity house for a science and engineering fraternity? The house is located on the edge of campus on the science and engineering side, 5 bdrm 3 bath

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