Buying A House In Minneapolis For Your College Student
Paying the skyrocketing costs of your child’s college tuition is tough enough, but add on living expenses and you’re talking about some serious money.
University of Minnesota dorms in the 2015-16 school year cost up to $5,844 with one roommate for two semesters. That’s $23,376 for four years, if your pupil finishes within that time – and only 44 percent do, according to the National Center for Education Statistics.
An off-campus apartment will cost about the same. Per-bedroom rent for the average Minneapolis two-bedroom apartment would cost $6,007 for nine months, or $24,028 over four years, not including utilities. That’s assuming they would be allowed to sublet while they leave campus for the summer.
If your child works hard, he should leave college with a bachelor’s degree, along with a lot of wonderful memories, but if you’ve been paying his dorm fees or rent, you’ll be left with nothing. You might be asking yourself whether you want to essentially throw your money away for the next four to six years.
Know Your Minneapolis Real Estate Options
However, there’s another option: buy a single-family home or duplex near campus for your child to live in as a student. You’ll be left with a valuable asset when those college years are finished. If you have younger children who will attend the same school, they can also live there. You can let student rent pay your mortgage and provide you with cash flow, building your wealth for you.
Or you can sell it after your children have gone for a tidy profit. The median home sale price in the metro area rose 37 percent from 2011 to 2014, according to the Minneapolis Area Association of Realtors.
With rising rents and home sale prices, and historically low mortgage rates, there comes a point in every metro area where it starts to become more cost-effective to buy housing instead of rent it. In Minneapolis, that point now is sitting at around three years. So whether you want to make this kind of investment should depend on how long you anticipate needing housing here.
Get Advice On Buying A House For Your College Student
Of course, there is no guarantee you’ll make money. That will depend partly on how much you spend and how long you’re willing to hold on to the property after your children are finished living in it.
Even if you only break even, you’ll have provided clean, stable housing for your child during his or her college years, avoiding the hassle and costs of moving each year.
If you have analyzed the pros and cons of such an investment and the numbers seem right for your situation, we can show you the best properties in Minneapolis for student living. If you live out of town or simply would rather avoid the responsibilities of a landlord, we can find you a reputable property management company.
Team Lindahl knows the Minneapolis housing market and we’ll make sure you don’t pay more than you should for your student’s temporary home. Get in touch, now.