Parents Buy Homes in College Towns to Save on Rent

In a growing trend, parents are purchasing homes in college towns to provide their children with rent-free living while also capitalizing on potential investment opportunities. This strategy not only alleviates the burden of exorbitant room and board fees but can also yield significant financial returns.

Candice St. Pierre, a mother from Georgia, made the decision to buy a home for her daughter attending the Savannah College of Art & Design. After experiencing the high costs associated with dorm living and off-campus apartments, which reached $1,000 per month, she opted for a more sustainable solution. In 2024, St. Pierre purchased a four-bedroom Victorian home in Midtown Savannah for $485,000. By converting the living room into an additional bedroom, she now rents to four other students, collecting $3,500 monthly in rent, effectively allowing her daughter to live there at no cost.

St. Pierre expressed confidence in her decision, stating, “I think my chances are pretty good that I will get a profit off of it whenever I do decide to sell.” She contemplates future possibilities, including renting the property as a whole or using it as a vacation home.

The rising costs of college education have prompted many parents to consider this approach. An analysis by Mortgage Research Network of 121 colleges revealed that, in 23 markets, buying a home was less expensive than paying for room and board. For instance, those with children enrolled at Temple University could save as much as $29,742 over three years compared to the total cost of room and board.

Despite the potential benefits, becoming a landlord to college students presents its challenges. St. Pierre noted the unexpected responsibilities that come with the role, including late-night calls and urgent problem-solving. She advised that those without real estate experience should consider their options carefully before diving into property management.

Similarly, LeAnne Carswell of South Carolina faced a similar dilemma when her son moved off-campus from Clemson University. Faced with the prospect of paying $12,000 annually for a premium apartment, Carswell purchased a townhome for $227,000. By charging her son’s roommate $775 a month, she successfully avoided significant rental expenses while also positioning herself for potential profit when selling the property in the future.

In another instance, Karen Yould, originally from Newport Beach, California, purchased a home in Missoula, Montana, for her son and his fiancée while he attended law school. Yould bought the property sight unseen for $220,000 in 2018. By assisting with housing expenses, she alleviated some of the financial pressures associated with education. When Yould sold the home in 2022 for $415,000, she made a profit of nearly $200,000.

Yould’s experience underscores the potential advantages of investing in college towns, which often maintain vibrant real estate markets. “I think if you’re looking for investments, a college town is always going to be vibrant,” she remarked, highlighting the appeal for parents looking to support their children while also securing a financial asset.

As more parents explore this avenue, the landscape of college housing may continue to evolve. The combination of educational expenses and the allure of real estate investment creates a unique opportunity for families willing to navigate the complexities of property ownership.