College town investment is not for everyone

Posted on March 23, 2007 by Jim Duncan

The title says it all; that this WSJ story focuses on Charlottesville is almost beside the point. But … with the University of Virginia growing, some “student” housing might prove to be a good investment. My favorite part of the story:

Shortly after I did the math, I contacted a real-estate agent in Charlottesville, Va., who was well acquainted with spreadsheet-toting parents like me. And he did something quite out of character for a broker — he talked me out of buying.

Honesty will go a long way.

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About Jim Duncan

A Charlottesville Realtor who tries to stay on the bleeding/cutting/functional edge of technology and real estate trends. I have been selling real estate for the past 10 years, lived in C'Ville for twenty+ and am married to one of few Charlottesville natives left.
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  • http://www.biggerpockets.com/renewsblog/ Joshua Dorkin

    Investing in college towns can be a good move – usually if it is a small town! With the way real estate is today, most of the college towns are hyper-inflated. Cash-flow is hard to come by and homes are simply more expensive then is worth it. It is scary when dorms provide a fair investment.

  • TrvlnMn

    If it’s a name brand college then I think it’s a safe investment. It’s an economic engine that isn’t going to go away. My caveat is that the person doing the investing should be doing it because they want the responsibilities of being a landlord, and not to make a buck of of their kid’s education experience.

    I am also of the opinion that a small landlord (a mom and pop outfit) should not be focusing on the undergrad rental market. Too much wear and tear. The great thing about a college town is that there are always people coming and going, enough so that one doesn’t always need undergraduate business.

  • http://www.realcentralva.com Jim Duncan

    The right property in the right location can be a good investment. There have been so many people over the past few years that have gotten into the “landlord” business that the market has been saturated.

    Locally, however as I noted last month UVA is growing faster than suitable housing is being built. The right opportunities are there … it just takes more diligence and research to find them than it used to.

  • http://www.johnsonteamrealestate.com/blog Nickie

    We are a college town that has seen huge appreciation in house values over the past several years. Buying houses as college rentals are no longer as good a deal as it used to be. However, we have seen a recent surplus of condos in Bellingham. We’ve had several WWU parents call us about buying a condo, not as a rental, but simply as the housing for their kid while they are here. Most of them plan to sell once thier kid is done at school.