Article courtesy of HGTV. Click the link at the bottom to read the full article!
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Buying a space for your student could turn out to be a great investment.
So you didn’t buy a rental home as part of your child’s college savings plan? No problem. Buy a property for your teenager to live in now while they’re attending college. It can be a worthwhile investment financially as well as an excellent learning experience.
In Boulder, Colo., if a parent bought a condo in the 1980s and held on to it for four years, they most likely would have sold it for about what they paid for it. If a parent bought a condo in the 1990s and sold it in four years, they most likely would have made enough profit to pay for their child’s education at the University of Colorado.
Owning the property your student lives in while he or she attends college can be beneficial in several ways:
- Stability. The student won’t need to look for a different apartment to live in each year. In addition, you can pick the lifestyle that will help your student succeed in school by choosing the location and the quality of housing that best fits their needs.
- Fixed housing expenses. In the past, apartment rents in Boulder have typically increased on an annual basis. By purchasing a property with a fixed rate mortgage, your student’s housing expense will be fixed. In addition, you won’t have to deal with paying security deposits or going through the hassle of getting the deposit back.
- Storage space. Having a single place to live in that you own means your student will not have to worry about storing furniture over the summer break.
- Life lessons. By purchasing a home for your student, you’ll be providing him/her an excellent learning experience. Your student will not only learn about the process of investing in real estate, but will also learn about the responsibilities that go along with property ownership.
- Financial benefits. Potential financial benefits include possible appreciation in value, possible tax benefits, and debt reduction on an amortized loan which increases equity build-up.