If you’re looking to invest in real estate, you might want to shop around in a college town.
According to Coldwell Banker, towns that neighbor universities and colleges continue to be a hot spot for real estate investing, regardless of the economic downturn.
A new survey conducted by the real estate company found that 73% of realtors see a significant number of investors buying homes near campus and renting them to people in the community. Additionally, 64% see a significant number of “parent investors” buying homes for their kids to live in while attending the university.
“Our survey suggests two types of investors see value in college towns,” Jim Gillespie, Coldwell Banker’s chief executive officer said. More long-term investors are being drawn to college towns because they provide a steady stream of renters.
Parent investors, on the other hand, buy homes for their child to live in while attending college in lieu of paying for them to live in a college dormitory. Parents let their child live there for free while roommates provide rental income for the mortgage.
However, the motivation to invest in real estate near universities isn’t only financial.
“Towns that are home to major universities have a special vibe you just don’t find anywhere else,” Gillespie said. “College towns offer rich culture, and most have steady economic bases oftentimes highlighted by outstanding medical and research facilities.”
As such, the survey found that those buying real estate weren’t just long-term and parent investors. Of the survey respondents, 51% said they see a lot of alumni homebuyers, and 49% see a significant number of retirees moving to their college town as well.