Buy rental property in location with no appreciation? Upstate NY

[Josh Feldman]

Would you buy a property near a flourishing university with the intention of converting it into a student rental, if the general trend of property valuation is stagnant or slightly decreasing? The population in this area is also declining by 0.91% each year, but I assume that's because of the elder population moving out due to increased student rentals in this area. This particular university has just had the highest rate of enrollment in its history so I am not concerned about vacancy rate. The purchase vs sold prices over the last 10 years have not changed much or at all. Please let me know your thoughts.

P.S., this is my first investment, I am working with a partner who went to this university (who also has never invested), and we both live on Long Island. All thoughts or recommendations are welcome!

[William Lidell]

@Josh Feldman Hi Josh. I am a real estate agent in the Binghamton area and am also a rental owner in a very similar situation. I help investors and also invest personally right by SUNY Binghamton. This is a university that has been growing its enrollment the last 5 years. Real estate investment in student rentals has followed and a boom in student housing has been the result. I know quite a few people who do exactly what you are talking about and yes being 4 hours away has its challenges, but the cash flow you can get in these areas is very attractive. Binghamton is also in a very stable market where you will not see a ton of appreciation, but you won’t see a lot of depreciation either. So overall I do think it is a good investment decision to be part of this trend.