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College towns, which typically have a steady stream of incoming student renters, have long been profitable destinations for real estate investors. Home prices in college towns have increased by 4% in the last year compared to a 1.6% growth rate nationwide, according to a new study from moving resource HireAHelper.
College towns tend to be key economic drivers for surrounding cities because they attract spending power, housing demand and employment. HireAHelper recently ranked more than 500 college towns on their real estate investment potential, weighing current home prices, historical and projected growth, housing availability and potential rental income.
The most affordable college towns are largely concentrated in the Midwest, with seven out of 10 being in Illinois or Indiana, according to the study’s findings. But topping the list for 2023: Indiana, Pa.
Property prices in the town, which is home to Indiana University of Pennsylvania, average around $160,500, a substantial hike of 19% over the last year alone. Growth is expected to continue there, with local home prices projected to increase by 12% over the next five years.
HireAHelper’s top 10 college towns in 2023, ranked by their real estate investment potential, are:
Indiana, Pa. (Indiana University of Pennsylvania)
- Median home price: $160,500
- 12-month price change: 19%
- 5-year price projection: 12%
McPherson, Kan. (McPherson College)
- Median home price: $179,800
- 12-month price change: 14%
- 5-year price projection: 14%
Brownwood, Texas (Howard Payne University)
- Median home price: $183,800
- 12-month price change: 17%
- 5-year price projection: 20%
Arkadelphia, Ark. (Henderson State University)
- Median home price: $151,300
- 12-month price change: 11%
- 5-year price projection: 16%
Winfield, Kan. (Southwestern College)
- Median home price: $143,300
- 12-month price change: 44%
- 5-year price projection: 13%
Williamsport, Pa. (multiple)
- Median home price: $136,800
- 12-month price change: 3%
- 5-year price projection: 13%
Clinton, S.C. (Presbyterian College)
- Median home price: $154,200
- 12-month price change: 4%
- 5-year price projection: 18%
Murray, Ky. (Murray State University)
- Median home price: $212,300
- 12-month price change: 27%
- 5-year price projection: 18%
Lubbock, Texas (Texas Tech University)
- Median home price: $261,100
- 12-month price change: 14%
- 5-year price projection: 18%
Atchison, Kan. (Benedictine College)
- Median home price: $156,400
- 12-month price change: 57%
- 5-year price projection: 5%
Many college towns are projected to post double-digit home price growth by percentage over the next five years, even as high as 33% in home appreciation by 2028, according to the study.
