The Pros and Cons of Buying Investment Properties Near Schools


5 May The Pros and Cons of Buying Investment Properties Near Schools

Whether you are thinking of getting into wholesaling or relying on income from rental properties or house flips, when it comes to investing in real estate, many factors can influence your decision to purchase a property near a school. 

One of the key considerations when thinking of real estate investing strategies is location. Some investors believe that investing in properties near schools can be a lucrative strategy, while others contend that this approach has potential drawbacks. Read on to learn how investing in real estate assets near schools could affect your long-term success!

Benefits of Investing Near a School

Having a school in the vicinity can make your property more attractive to potential tenants and buyers, as families with children typically search for homes near good schools. If you're investing in a market with high demand for purchases and rentals near schools, you may see some benefits.

Higher Property Appreciation Value

Properties near schools tend to appreciate better than other properties. Since there will always be high demand for housing near good schools, it can be a wise decision to purchase investment properties with proximity to grade schools or colleges. 

Set of School zone warning sign on blur traffic road

In addition, families with school-aged children are often willing to pay a premium for the convenience of having a home close to their child's school. When considering a new investment, we recommend working with a professional appraiser to understand a property's value and appreciation potential fully.

Family-Friendly Environment and Green Spaces

Another potential benefit of investing in a property near a school is the appeal of a family-friendly environment—an appealing trait to parents with children looking for a safe and secure neighborhood to raise their kids. 

In neighborhoods with nearby schools, you’ll often find easy access to playgrounds, parks, and other kid-friendly amenities near schools, making these properties even more attractive to families.

A Consistent Pool of Tenants or Buyers

Since families tend to stay put for several years while their children are enrolled in a school, you may have fewer turnover costs (and income losses) associated with a rental property if rental homes are part of your investing strategy.

In addition, fix-and-flip investors may have an easier time finding buyers for properties located near schools. If you're looking to unload a property quickly, a real estate investment near a school could be a solid strategy.

A Future Proof Investment

Lastly, investing in a property near a school can provide you with the peace of mind that comes with investing in a "recession-proof" asset. Even during tough economic times, families will still need somewhere to live and always want to be close to good schools. This makes properties near schools a relatively safe investment.

Drawbacks of Investing Near a School

While there are many potential benefits to investing in a property near a school, there are also some potential drawbacks that you should be aware of before investing. Here are a few concerns to consider.

The Potential for Lower Rent or Resell Prices

Often, rental homes or house flips that target areas near schools and families sell or rent for lower costs. While this can make it easier to buy properties at lower price points, the consequence could be lower rent prices and less income for rental properties or lower resell prices for fix-and-flip investors. 

Schools Can be Noisy

Properties close to a school are generally subject to higher noise levels than homes further away from schools. This can be a disruptive experience for those who consider home a place of relaxation. For example, if a property is near a high school, the noise from marching band practice or football games can make the home undesirable to buyers or renters without kids. 

Traffic Jams During Pick-up and Drop-off Hours

Another potential drawback of these real estate investments is the traffic factor. Living close to a school will carry the potential for increased traffic, both during drop-off and pick-up times. This can make it challenging to get around the neighborhood and add to a resident's levels of stress.

Increased Competition

Lastly, one potential drawback of owning real estate near a school is the increased competition from other real estate investors. If you are looking to invest in a property near a school, you can expect stiff competition from other investors trying to take advantage of this investing strategy. Generating a passive real estate investing strategy may be more challenging in these areas.

The Bottom Line

If you’re thinking of becoming a full-time investor, you want to ensure a steady ROI that allows you to leave your full-time job behind and enjoy investment income long-term. 

School Building

Investing in a real estate market and property near a school can be a great way to make money. However, it is essential to weigh the pros and cons before making your final decision. If you do your research and understand the risks involved, putting your money in an investment property near a school can be a wise decision.

Find Your Next Venture to Passive Real Estate Investing in Privy

Whether you choose properties near schools or not, you need the best real estate investing strategies and investments. With Privy, a real estate investor can scour the market for the best investment properties, get real-time alerts when new properties become available, and receive investor insights to make smart deals. Reach out to our team to learn more about how it works! 

Download our free "How to Invest In Real Estate: A Guide!" for more expert tips.


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