When the kids get ready for college, their parents may be thinking about purchasing real estate in university towns. Move, Inc., compiled a list of the top ten college towns that make smart investments (using information from the 2011 US News Rankings and Reviews list of best colleges for great prices). They are Boston, Nashville, Chicago, Washington, Houston, South Bend, Atlanta, Baltimore, St. Louis, and Syracuse.
The Boston/Cambridge region, which is surrounded by over 50 academic institutions, exhibits ideal market conditions. “Combine the supply and demand ratio with rising admissions and the five percent rise in rental rates expected by the end of the year, and rental property in college towns can be a smart option for the right investor,” says Chief Executive Officer of Move, Inc., Steve Berkowitz.
In June 2011, the Northeast city had a median list price of $335,000 and a very high demand for rental units. Average rental rates in Boston (in the same month) ranged from $3,122 for a 2-bedroom to $3,913 for a 3-plus bedroom unit, which beats a mortgage payment of $1,370 with 20 percent down at current rates for a 30-year fixed loan. With the dip in housing prices and rates, back-to-school shopping could mean real estate investing.