Dorm Living vs Buying an Investment Home

Perhaps you will soon be dropping off a child at college. Most likely he/she will be living in a small dorm room or be forced to live in an expensive apartment in town due to a shortage of on-campus housing. If so, then this might be the time for you to consider an investment purchase that can benefit both your child and you.

Because the supply of housing in college towns is limited and the demand for it is constant, many owners of Huntsville AL real estate are investing in college town properties. While the positive ramifications of such a transaction are many, there are some negative situations to avoid. If you are in a position to consider becoming a landlord in an academic community, read on

Probable Positives:

• More and more adult learners, who eschew dorm living, are returning to college.


• An increasing number of married couples are part of the student body..


• Houses and apartments near campus have low vacancy rates--and a new supply of renters each fall.


• If your child lives in your property, your housing money will go towards paying off your mortgage.


• You can write off the interest on your income tax.


• Faculty members and school staff also provide a large and stable rental pool.


• Since college towns are becoming increasingly popular with retirees, you might rent to that someone in that sector.

Possible Negatives:

• The greater the distance from your Huntsville AL home to the investment property, the more difficult it becomes to check on maintenance, and hiring a property a property management firm can be expensive.


• Excessive maintenance can eat up time and money. This expense includes replacing worn or damaged carpet, repainting of walls, and sometimes extensive cleaning when a tenant moves out.


• Evicting tenants, should that become necessary, is a difficult, time consuming, and expensive process.

TIMELY TIPS:

• Screen and select your renters very carefully. Look to older, more mature individuals--graduate students, perhaps..


• Make sure you have a well-written and far-reaching lease .


• Look for a college town that has a low ratio (30% or less) of university beds to student population


• Consider closeness to campus and/or proximity to public transportation


• Do your homework re: property taxes, insurance costs, neighborhood crime rate, and proposed building projects.

Huntsville Alabama Real Estate Real Estate Broker, Mike Manosky

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