Real estate can be a very lucrative business even if you’re not a big land baron. If you’re willing to risk a keg being thrown through the drywall, college towns provide a guaranteed need for rental properties and can make you some serious cash.
RealtyTrac recently did a survey of every town with a four-year college of at least 20,000 students and examined the return on rental investments. The results were not what you’d expect. Sure there were some big name schools like Ohio State and Nebraska on the list but the top towns to rent in were surprising.
#3 - Gainesville, Florida
More than 30,000 students attend the University of Florida and have helped drive the annual gross rental yield in town to 11.34%. Daren Blomquist, VP at RealtyTrac says, “Florida is all about...relatively low-priced properties compared to a lot of the rest of the country. Landlords can get in and buy a property for $100,000 - $150,000 in many of these markets and turn around and rent the property out for close to $1,000 a month.”
#2 - Trenton, New Jersey
When you think of Trenton you don’t think college town. The College of New Jersey is in nearby Ewing and it does have the lesser known Thomas Edison State College within its borders. That technically got the town on the list. The annual gross rental yield in New Jersey’s state capital is a whopping 13.2%. That’s because “there’s still a backlog of distressed properties that’s coming through,” Blomquist notes. “We’ve been seeing an increases in foreclosures over the last couple of years which is counter to the national trend. You can come in and find some of this lower priced distressed property available that you can purchase and turn around and rent out.”
#1 Akron, Ohio
Even big Ohio schools like Ohio State and Cincinnati, both of which made the top ten, couldn’t eclipse the University of Akron and their 20,000-plus student body who have driven the annual gross rental yield in Akron to 13.81%. “Ohio is also another place, similar to Florida, where you can buy property relatively cheap,” Blomquist notes. But you had better act quick because it’s not just mom and pop landlords who have seen the value of the Buckeye State. “We actually see a lot of the big institutional investors going into Ohio because they recognize this as well.”