Last Updated on September 20, 2021 by Kim Labriola
Do you have a student attending University of Arizona? Are you curious about what the benefits are of buying versus renting?
I have been helping families buy properties near University of Arizona for over a decade. I can share what numerous clients experience as their student transitions into campus life. Please keep in mind, I am not a property manager. I provide these examples to help people with researching the rental market, but I am licensed to help people buy and sell properties.
Pros of Buying
- Build equity rather than pay a landlord.
- Can rent out rooms to help cover the mortgage.
- Keep it as investment property after your student graduates.
- Can personalize or change the space.
Cons of Buying
- If you rent the property out, you have to be the landlord or hire a property manager.
- It can be more risky, especially if keeping the property short term.
- Your money is tied up in a less-liquid asset.
- Must budget for maintenance.
Pros of Renting
- No property maintenance required.
- Only committed for time of the lease.
- Smaller initial investment (security deposit vs down payment and closing costs).
Cons of Renting
- No equity is being built.
- Rent amount can change when renewing a lease.
- Landlord may not renew lease, forcing a move.
- Can’t personalize your space.
Have questions about buying a home near University of Arizona? We can help.
4 types of rental housing for students
First, we’ll discuss rental housing. There are four main categories of rental housing for students near University of Arizona: On-campus dorms, off-campus student housing, apartments, and rental homes.
Incoming freshman are not required to live on campus; however, students will usually want to spend the first year in a dorm. This gives a student an opportunity to socialize, meet friends, and get adjusted to campus life. 80% of students who live on campus are first-year students. After the first or second semester students often prefer moving to off-campus housing.
There are 23 residence halls plus an honors dorm on campus. Dorms range in size from 60 sq. ft. to 731 sq. ft. Styles range from studio, single, double, and triple residents. Some newer dorms are suite-style with a private bath, but most have a common bathroom down the hall. Some rooms provide sinks, but cooking is prohibited in rooms.
Dorms are priced for the fall and spring semesters, and rents (as of summer 2021) range from $6,470 to $13,390 per academic year. Students are not allowed to stay in the dorms over winter and summer breaks.
Off-Campus Student Housing
There are several large off-campus student housing complexes that cater to university students. They rent monthly per bedroom. Many of these are luxury properties that are furnished, offer rooftop pools, gyms, and other high-end amenities. Floor plan layouts range from studio units up to 6-bedroom units. The students usually have private bedrooms, but share a kitchen, living room, laundry, and possibly a bathroom. Rents typically start at approximately $800 per room and can go as high as $1,900 for a private studio (prices are as of summer 2021). Generally, the more bedrooms, the less expensive per person it is.
Renting a Room in an Apartment or House
Another option is renting a room, condominium, townhome, or apartment near the campus. Typically, if you rent from a private-party near the university, rent will be by the room, and will be approximately $450 to $600 per month (as of summer 2021). There may be an additional charge for utilities, or the student may pay their own utilities, depending on how the physical property is metered from the utility companies. Usually, these properties are rooms or casitas that a nearby resident rents to students. Or a student may be a roommate in a condo, townhome, or house near the school.
There are also apartment complexes nearby that were generally built in the 1960s that students can share rent with roommates. Rent for these will usually be around $600 per room plus utilities (as of summer 2021).
Buying a home near University of Arizona
Parents often find that buying a property near the university makes more sense for them. They may have siblings that will attend the school in a few years which allows even greater savings.
This option can allow the student to live in one of the bedrooms and rent out other bedroom(s) to their friends. With this scenario, the student normally becomes the property manager. Typically, room rents may be between $450 to $600 per month depending on amenities and proximity to campus. The landlord also must negotiate utilities, collect rents, manage the property and maintenance and deal with leases. Sometimes the landlord opts to hire a property manager to take care of these items instead.
Parents buying a home for their student makes financial sense if their student plans to stay in the Tucson area for 5 or more years or if the parents are looking to diversify their assets by becoming a real estate investor after their student finishes college.
Types of properties to buy near campus
Property options are usually a condominium, townhome, single-family residence, or duplex close to the college. Each will have advantages and disadvantages.
Buying a Condo
Condos and townhomes will have an additional cost of a monthly homeowner’s association. This can be a benefit since common area maintenance and some property maintenance is included with this fee. The property may also have desirable amenities such as a community pool. With a single-family residence, you are responsible for all the property maintenance, yard work, etc.
Warning: Financing May Not Be Available For Condos
There is a common obstacle that comes up which is important to speak with a lender about (let me know if you need a recommendation for great local lenders). It has to do with obtaining financing on condominiums.
When someone already owns a primary residence, if they purchase a second home a lender will see them as an investor. If a condominium development has a large percentage of non-owner occupants (rentals), lenders will see a development as a greater lending risk. It may be difficult or impossible to get a non-primary home loan on many condo properties. This is usually not a problem with townhomes or single-family homes.
Student Purchasing the Home Themselves
For a client wishing to purchase the property to live in themselves and possibly rent rooms to others, you need to check on lending requirements. Even as an owner occupant, it may be difficult to get FHA financing on a condominium. Please check the Housing Urban Development website for a list of developments that are eligible for FHA financing.
It is also important to work with a lender who is familiar with rental properties. I recommend talking with qualified lender to get your questions answered. If you don’t have one, I am happy to recommend a great local lender (by the way, I don’t get paid anything for recommending a lender. I just prefer working with lenders who give my clients great service). contact me at Hello@RealTucson.com
Your Situation Is Unique
This is just a primer on the different types of properties available near the university and the pros and cons of renting or buying. There is so much to think about in choosing the right type of property and location for you.
If you would like to learn more, I specialize in helping families buy rental properties near the University of Arizona. Please contact me at 520-975-8956 or Hello@RealTucson.com for a free no obligation consultation. Also take a look at my Guide to Buying UA Homes for more valuable info about buying a home near University of Arizona.