Investing in college towns: Ellensburg Washington

[Aaron Gowin]

My wife and I are prepping our home for sale and are looking to move the capital from the sale into some rental investments. We live near Seattle where we are having trouble finding properties with numbers we like. We have started looking farther out of the area we live in for other investment opportunities. 

Does anyone have any experience or advice in regards to investment properties in college towns like Ellensburg Washington, zip code 98926? They are a college town with not many other towns around them. They have a population of about 18,000 persons. We see some properties with numbers that seem to be promising, but renting to students and having to do shorter term leases seems like it might not lead to the greatest self sustaining business. Any thoughts?

[Levi T.]

I have a few of these, wish I could find more of them. Find a town with a University, not just a college, that classification is important for some reason I find. I look for towns with a continues population growth, not flat or down.

Once you found your town, you need to stay close to campus, like sub 1 mile. Try to find a property owned by a self managed landlord that does not rent to college students, repairs have been put off, and rents are well below market. Hopefully tenants are all working class and section 8. After that, all you have to do is roll up the property.

Always require mom and dad to co-sign. We have found all our college tenants parents make on average $10,000-40,000 a month. The building stays perfect, as you know mom and dad have the cash to cover any damages. Keep in mind that these kids mean the world to their parents, they expect things to be beyond perfect, and will pay for it at all cost.

There is no room for being unprofessional as they can take you to task in court, so just fix it and move on. It's about full service landlording.

If you provide top notch service, you will find they all pay rents on time, in fact most our rents come in 10 days before they are due. Finding one is the hard part.

Good luck!