Student Housing Represents Great Investment Opportunity

June 26, 2017

Student Housing Represents Great Investment Opportunity

According to a recent Gallup poll, 53% of Americans say they are currently investing in the stock market. But if you want to get the best results for your money, you will need a well diversified portfolio.

If you're looking for real estate investment opportunities here in California, then student housing is one of the most exciting options on the market today. Colleges and universities across the country, and in fact across the globe, are expanding faster than they ever have as more people turn to college and postgraduate education as a way to secure more lucrative careers. Not only that, but wealthy foreign students are coming to U.S. colleges in record numbers.

Detractors have long sought to dampen this market, referring to the market as part of the so-called "higher education bubble." But as the developed world continues down its path towards service-based industries and away from older, manufacturing-based industries, more and more students are finding that without a bachelor's degree, their prospective earnings are greatly diminished over the course of their lifetime.

But as many of these schools continue their unprecedented expansion, many are running into a very real problem: a lack of student housing. Many schools are resorting to converting double bedrooms into triple bedrooms just to keep up.

Considering the high cost of room and board at many colleges, many students are naturally resisting any such changes that might impede their comfort. Plus, as more students demand a luxury experience from their astronomically expensive colleges, many young people will turn to off-campus housing instead of the typical dorm room experience.

Overly pampered college students may be a popular bogeyman in the media, but they also represent a major investment opportunity for savvy investors. That is, in part, why the student accommodations market is such a hot commodity for real estate investors right now. After all, displaced students represent a significant source of income for rental properties.

Unlike other real estate investment opportunities, student housing also represents a recession-proof market. Unlike commercial real-estate, whose tenants are often very vulnerable to recessions, student housing investment opportunities actually see a slight growth during recession as more people return to school.

That doesn't mean that student housing is without it's drawbacks. According to RE Journal's 2017 Student Housing conference, panelists noted that, unlike more conventional rental properties, it was important to maintain single purpose buildings for student accommodation properties. 

According to the RE Journal's summation, "The panelists agreed that combining student housing with ground floor retail can be risky and more difficult to finance. The more uses you have, the harder it is to manage." 

Still, student housing projects represent one of the lowest risks and highest return real estate investment opportunities available today.

Want to invest in student housing in California? Hubilu Ventures Corp is Los Angeles's preeminent Real Estate Acquisition Company. If you have any questions about investing in student accommodations, call our Real Estate Investment Advisors today to get started.

p. (310) 308-7887

205 S Beverly Dr. Suite 205
Beverly Hills, CA 90212