Real Estate: Investing in College Towns

By Suzanne Woolley - 2012-11-05T17:52:30Z

Photograph by Monica Almeida/The New York Times via Redux

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Riverside, California

College: University of California, Riverside
Students: 20,956
Median home value: $191,800

College-town investors tend to favor public college towns since student bodies are often larger and the schools tend to have fewer housing restrictions. UC Riverside expects to have about 25,000 students by 2025-2026, a 19 percent jump from today. Weigh that against the fact that the university plans to build more housing; its newest 800-bed project, originally expected to open for the 2013-2014 year, is slated for 2014-2015. Zillow's breakeven horizon for Riverside is two years. Monthly payments on a 30-year fixed mortgage at 3.5 percent would be $861, about half the Zillow Rent Index's $1,558.