It is typical to seek out that which is familiar to us?an often-useful strategy in our day-to-day lives. As young people, you may find yourselves living in areas with a similar demographic, which is to say, college towns. Your proximity to these areas may seem either encouraging or troubling, depending on your own experience as a renter and the experience of those around you (which may actually serve as inspiration for you). As a young investor, you may be wondering if it is wise to invest in areas with a heavy influx of student renters.
Though the thought of having college-age students as renters can be daunting (we?ve all heard horror stories of fights among roommates, crazy parties, and difficulties in the off season), we?ve found college towns to be a more than worthwhile location for property investment.
Which is to say that the simple answer is yes?Jason Hartman loves areas that offer student housing investment opportunities because they offer a large transient population with a low percentage of individuals trying to buy. This helps regulate the price of property and ensures that properties are generally filled. The high influx of renters also allows for the property manager to collect a healthy amount of rent.
Another advantage offered by college towns is the ability of these properties to self-market. Towns with large university populations always provide amenities popular with renters?entertainment, culture, food, shopping, and public transportation. This attracts renters naturally, so property managers don?t have to invest additional time and money in providing these things.
And while we highly recommend this strategy, do proceed with a little bit of caution. As we mentioned, it can be difficult to fill vacancies during the summer months. Plan accordingly?and consider alternative strategies (such as vacation or short-term rental options) for these less-than-flush times. Foster a living environment that encourages renters to care about their living space by building community, trust, and positive attitude.
Finally, remember that every investment area comes with its own set of challenges. Picking an area that is right for you is never easy, but is always worth it. Before any investment, be sure to research the area, the pros and cons, and the potential for growth. When you?ve acquired the necessary tools to be successful, go forward with confidence, optimism, and the desire for success!
The Young Wealth Team