SCOTTSDALE, Ariz. — Looking to buy a stable rental property that will bring in money no matter how the economy is?
Investors are turning to college towns to achieve that goal.
Valley real estate expert Dean Wegner said buying a home near Arizona State University or any university, then renting it out to college students, is a good investment.
“Everyone wants Tempe,” said Wegner. “They know it’s going to rent quick. You’re going to get a higher price and, for the most part, it’s the parents that will be making the monthly payments.”
A real estate website, trulia.com, said there’s increased demand for college-town rentals and rents have jumped 5 percent in the past year.
Wegner said Tempe, Tucson, and Flagstaff are all good Arizona college towns for buying a rental.
“All college towns are really the same way,” said Wegner. “You’re always going to have a high demand for rentals. … The renters are going to stay a couple of years. You can buy a $70,000 condo, or a $120,000 house — something on the lower end — and always have a good return on your investment.”
Wegner said investors can buy in a college town without much risk.
“They know the kids are going to trash the place a little bit, but they’re not buying five-star places,” said Wegner. “They are buying average places that get rented out really fast.”
Wegner said before they rent places out, investors often do a background check on a student’s parents, knowing that many times, they are the ones who will be paying the rent.