Published May 16, 2024.
Written by Reno Perry.

Is Buying Real Estate in a College Town a Wise Investment?

If you're considering investing in real estate, college towns offer unique opportunities. Southern California, home to several prestigious colleges, presents an ideal landscape for real estate investments. Here's why investing in properties near college campuses, especially in and around the Claremont Colleges, Azusa Pacific University, and other local institutions, can be a smart move.

1. Consistent Rental Demand

One of the biggest advantages of investing in college towns is the steady demand for rental properties. Students, faculty, and staff constantly seek housing close to campus, ensuring a reliable stream of potential tenants. For instance:

• The Claremont Colleges: This consortium includes Pomona College, Claremont McKenna College, Harvey Mudd College, Scripps College, Pitzer College, and the Keck Graduate Instititute, collectively enrolling thousands of students annually .

• Azusa Pacific University (APU): With a significant student population of over 10,000, APU generates high demand for nearby housing .

• Community Colleges: Institutions like Mt. San Antonio College (Mt. Sac) (60k+ students), Glendora’s own Citrus College, (20k+ students) and Chaffey College (19k+ students) also contribute to the rental market with their large student bodies. All together, nearly 100,000 students are drawn just to these three community colleges.

2. High Property Appreciation

Properties in college towns often experience above-average appreciation rates due to the continuous influx of students and the development of nearby amenities. For example:

• Claremont Colleges Area: Homes around Claremont often see strong appreciation due to the prestigious nature of these institutions and the attractive campus environments. The median sale price per square foot in Claremont is $495, up 10.5% since last year. (Redfin)

• Cal State Fullerton: Located in Fullerton, this university boosts local property values, making it a prime location for real estate investment. In April 2024, Fullerton home prices were up 16.2% compared to last year. (Redfin)

• University of California, Riverside (UCR): UCR's presence enhances property values in Riverside, with the university's growth contributing to local real estate appreciation. In April 2024, Riverside home prices were up 3.6% compared to last year. (Redfin)

3. Economic Stability

College towns benefit from the economic stability provided by educational institutions, which act as major employers and economic drivers. This stability can protect property values even during economic downturns.

• Cal State LA: As a major employer, Cal State LA supports the local economy and helps maintain property values in the surrounding area. In 2019, California State Los Angeles employed 1,755 people. (The California State University)

• Fullerton College: This community college also contributes significantly to the local economy, making Fullerton a stable area for real estate investment. In 2019, California State Fullerton employed 2,588 people. (The California State University.

• La Verne University: In Fall 2009, the University of La Verne hired 198 full-time and 414 part-time faculty, 220 Administrative/Professional staff, as well as 167 classified staff, with a total of nearly 1,000 employees in a city with a population of 30,000 people. (La Verne University)

4. Potential for Short-Term Rentals

The rise of platforms like Airbnb has opened up new opportunities for short-term rentals in college towns, catering to visiting parents, prospective students, and academic conferences.

• Azusa Pacific University: Properties near APU can be marketed as short-term rentals, especially during graduation season and major university events.

• Claremont Colleges: The various events and conferences held by these colleges create demand for short-term lodging options.

5. Community Development and Amenities

College towns often boast well-developed infrastructure and amenities that cater to both students and permanent residents, enhancing the appeal of investing in these areas.

• Claremont: Known for its vibrant community and cultural amenities, Claremont offers an attractive living environment for both students and long-term residents. Downtown Claremont is a beloved center for students and local residents alike.

• Azusa and Glendora: The areas around Azusa Pacific University and neighboring cities are continuously developing, offering better facilities and lifestyle options.

• La Verne: Downtown La Verne has a bustling community of restaurants, coffee shops, bars and boutique stores.

Conclusion

Investing in real estate near colleges in Southern California, such as the Claremont Colleges, Azusa Pacific University, and others, offers endless benefits.

From consistent rental demand and high property appreciation to economic stability and short-term rental potential, these areas provide promising opportunities for real estate investors. Whether you're a seasoned investor or buying your first home, consider the unique advantages of college towns to make a wise investment.

For more information on real estate opportunities in these areas, feel free to contact our team at Century 21 Marty Rodriguez. We’ve been helping our clients make the right decisions about real estate in Southern California since 1978!