Saturday, March 15, 2008

Slumlord 101

What a great idea.

First, graduate from college and move out of the "student ghetto" - that area of barely livable houses and apartments that surrounds most schools and caters to dorm overflow. Then you turn around and start buying up property in the same ghetto and renting it back to your friends and former neighbors.
A year ago, Jeff Shea began buying up rental properties around the University of Illinois at Urbana-Champaign, from which he had only recently graduated with a business major. Shea, 23, who lives in Chicago, owns three rental homes near campus, including a four-bedroom house he bought for $138,000 and rents to four students for $1,800 a month.

"It's the best time ever to buy houses," Shea said. "The rent is inflated because so many people go to school here."
Just be sure to let people think you have a slightly more respectable job - like piano player in a whorehouse.

There are some risks, of course.
But like any real estate investment, buying in a college town comes with risks, particularly for investors. Think Animal House. Students are known to drink, punch holes through windows, spill beer on carpets, or just not be very responsible.
Students? Irresponsible? I'm Shocked! Shocked, I tell you!
College Towns: Still a Smart Investment - Yahoo! News