Renting out a house within or near college towns is a good investment. For the past few years, real estate rentals in these areas have yielded high especially for single-family detached homes.
Home investors in areas near colleges and universities across the United States earn a big sum of profit by renting out properties, noted the National Real Estate Investor. The vice president of RealtyTrac's data firm, Daren Blomquist, said, "Many of the counties at the top of the list for strong rental yields are in college towns."
The main reason for this trend is that the demand for accommodation in college towns is always high. As a result, many landlords increase rental fees every so often in these areas.
At the moment, big corporations have started stepping in these locations to build sizeable housing communities for students. On the other hand, many college-goers still live in detached single-family homes outside the campus.
The demand for housing in college towns has always been stable unlike those in areas far from colleges and universities, said Investopedia. Although there are housing opportunities inside the campus, it could not meet the number of students and professors who need accommodations.
According to studies, there is higher profit from home rentals in locations where there are young renters. "Many towns with many young residents have strong gross annual rental yields, averaging around 10 percent, including East Lansing, Mich., Gainesville, Fla. and Athens, Ga.," Blomquist revealed.
The VP of RealtyTrac for data firm, on the other hand, mentioned that the number of students is not always in direct proportion to the profit yield from rentals. For instance, in Arlington County in Virginia, more than a third of the population is comprised of young residents but the average profit from single-family houses for rent is less than four percent. Even college towns in high-priced cities suffer from a low rate of home rentals.
