Student Housing Bubble?

[Jason V.]

I had an interesting exchange with another local investor that led me to explore some property in the areas immediately surrounding the several high-end universities in our city. Apart from the challenges of owning rentals that are primarily occupied by students, and the relatively high property values in these areas, I was struck by another concern:

There is a school of thought gaining traction that Higher Education is currently experiencing a huge bubble, and might actually be cresting, if not very close to it. Glenn Reynolds and Jim Rogers have both written quite a bit about this as insiders.

For the last 10 years enrollment has done nothing but increase, along with tuition, and also the unemployment rate of recent graduates. If higher education is a bubble (which I’m inclined to think it is, although I have no skin in that particular game) what does that mean for the markets around the schools?