Why You Should Buy A Condo For Your NAU Student

The reality is that college is expensive and housing is a big part of that expense. Your kid is going to need a place to live for the next four years, so why not defray some of that cost by investing in a property that your kid could live in while at NAU? Right now it’s typically less expensive to own than to rent, plus you have other benefits such as gaining equity through paying down the mortgage and possible appreciation. Let’s explore some of these options…

Living in the NAU dorms:
Looking on NAU’s Residence Life website, dorms can be as high as $599/month, with a typical rent appearing to be $470/month. This isn’t horrible, but in most dorms you have to move your kid in and out each school year and you have nothing to show for all that money spent in rent for four years. Even if you’ve decided to have your kid in the dorms for the first year, it still makes sense to invest in a property for their remaining three years and maybe even keep the property as a rental after they graduate.

Renting off campus:
Renting off campus in Flagstaff can be $500+ when sharing with roommates and even more if you rent your own 1-bedroom place. The problem here is that you’ve spent over $24,000 in rent in four years with nothing to show for it. Plus, you’re competing with many others to find the good rentals and being at the whim of a landlord means your son or daughter may be forced to move multiple times during their time at NAU.

Buying a Condo or Townhome in Flagstaff:
Your total monthly payment on a 1-bedroom or studio you purchase will very likely be less than the amount you’d pay in rent, depending on how much you put down. An even better option is to buy a two or three bedroom condo or townhome and have your student get roommates whose rents contribute to the mortgage, making your total monthly cost much less than if you were just paying rent. Not only are you paying less each month, but no matter which option you choose, you’re also gaining equity by paying down your mortgage each month, which can add up to thousands of dollars over the course of three or four years.

Single-family homes are also an option, but most people prefer a condo or townhome in this situation because of the lower maintenance and lower prices. I can help you determine which options might make the most sense for your situation.

If you’re wondering how much you’d need to spend upfront for this, you can purchase a second home with conventional financing and a down payment anywhere from 5-20%. There’s also an FHA loan product, informally called a “Kiddie Condo Loan,” that allows you to purchase the home with your son or daughter for as little as 3.5% down. I can provide you with more specifics on which condos and townhomes in Flagstaff might be the best fit and what to expect with the prices of those units, but in general, condos are ranging in the low-to-mid $100k’s and townhomes in the mid $100k’s to $200k.

Owning investment property is one of the best ways to gain wealth and investing in a condo or townhome for your NAU student is a perfect opportunity to get started. At the very least, you’ve defrayed some of the costs of college, you’ve provided a stable environment for your son or daughter, and given them an introduction to the responsibilities and benefits of homeownership.

Pending Sales in Flagstaff are Up

February’s stats for Flagstaff real estate are in and pending sales (listings under contract) have shot up 25% over last month to the highest level since last July. Pending sales have increased in all categories: short-sales, foreclosures, new construction, and traditional sales. Of course, the great part is that it’s only March and sales typically increase from now through the summer.

The number of homes on the market has begun climbing, which is typical as spring and summer approach. Distressed sales (short sales and foreclosures) made up a little over half of the 54 sales in Flagstaff in February. One in five sales were short sales and one in three were foreclosures.

The market is showing signs of life and prices are holding stable! If you’re considering selling, now is a good time for you with the market being more balanced than it’s been in years and if you’re a buyer, now is your chance to take advantage of the low interest rates.