http://www.housingwatch.com/2010/11/17/college-town-real-estate-should-p...

Buy a house for your college kid? Isn't paying tuition enough? Turns out that in the right areas, it can be more economical -- and maybe even a good investment -- to buy your kid a home or condo instead of tossing money on rent or dorm fees. "Parent investors" are a savvy group of home buyers who invest in homes for their kids to live in while attending college. A survey by Coldwell Banker found that 64% of its real estate agents are seeing a significant number of parents investing in homes for their kids to live in while they attend college. Seventy-three percent of those surveyed said those buyers are buying homes or condos near college campuses and renting them, with only 21 percent seeing a decrease in this trend over the past five years despite the recession.

But once the kids graduate, are mom and dad left holding the mortgage?

Not necessarily, and some say they just might downsize to Juniors condo. The CEO of Coldwell Banker, Jim Gillespie, says interest in college towns is always going to be high and recession-proof, because people perceive value in the investment, even more so if they went to school there.

Rogers Healy is like the Mark Zuckerberg of real estate. The thirty year old Dallas real estate broker got his license while a college junior at Southern Methodist University. He saw a trend of parents leasing fancy apartments for their kids, his fellow students. Then builders started building town-homes marketed towards selling those same kids. Rocket science: Rogers first leased, then sold units, which morphed into a full time job post graduation just as the Dallas market was heating up. If I could do one thing forever, he says, I'd develop my business on college campuses with high net worth students. There's always going to be a Daddy's princess who needs to be housed in style for at least four years.

His most outrageous sale was to a parent from Orange County, CA whose daughter was a freshman at SMU. Healy took her to see a couple of condos leasing for about $1100 a bedroom. The client asked, how much are these units? $600,000 apiece, said Healy. The father asked how many were available -- three. I'll take them all, he said.

"Property here was appreciating at 7 to 12 percent in the peak years, '05 to '08," says Healy, who launched three more websites this year. LivebyTCU.com is netting him 20 to 30 clients a day who want to buy near the Texas Christian University campus in Fort Worth. In Austin, Healy's ATX.renting.com sends him a few buyer leads, as is SanAntoniorenting.com.

Speaking of San Antonio, I still own a home there I purchased for about $175,000 in 2005 when my son attended Trinity University. After he graduated in 2007, I leased it to three female students, thinking they'd be easier on the house. It's now in the hands of a young couple who will be leaving in April. I may sell the house, or re-lease it again next spring, which Rogers reminds me is prime time for college leasing and buying.

Healy got in on the upside of the market; others may not be as fortunate.

Gloria Curtis' daughter also attended SMU. The couple had a friend who was a developer in a new project adjacent to the SMU campus, and they bought a two bedroom, two bath unit in 2007 for about $450,000. Gloria's daughter, Kellyn, moved in along with three friends. The parents primary concern: safety for their girls.

"It all fell into place with her friends and roommates because all the parents wanted the kids to be safe and secure, says Curtis. "And everyone always paid their rent on time."

The girls had 24-hour security, access to a spa, health club, and restaurants. For a time, the hotel even had a car the girls could use as a shuttle service. But now that Kellyn has graduated, Curtis says she knows they won't be making any profits on that condo if they sold it tomorrow. If she could go back, would she still have signed on the dotted?

"Knowing what I know now, I might not have done it," she says. "But the jury's still out for us -- I think we can make it work for us, but it will take a little longer."

Worst comes to worse, Curtis says she may sell her home in Garland, Texas and move into that fun Dallas condo.

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