According to the US Department of Education, the average college tuition at a public school has increased 41% over the last ten years, and 18% for a private school. Based on 2010-2011 tuition rates, it would cost over $70,000 for a 4 year degree at a public school and over $120,000 at a private school...and this isn't even including room and board.
These are daunting figures for most parents, but there is a way to not only limit your costs but also make a long term investment while you kids are in school. With today's low-mortgage rates and property values, it many areas it is cheaper to buy than to rent. An alternative to overpriced meal plans and throwing money away at room and board might be purchasing a home near the school you child attends and renting out extra bedrooms. At minimum, you may be able to allow your child to live "rent-free." Or, depending on the market, you might actually make a little money that can help pay for books and tuition.
After graduation, you can either keep the property as an investment, or sell the property and defer any gains through a 1031 exchange and purchase another investment property. If you have a child attending one of the many colleges/universities in Portland or Vancouver, give me a call and I can help you work through the numbers to decide if this is a good investment plan for you, as well as help you find the right property to meet your needs. As always, my goal is to make the real estate process as simple as possible!
-John Blom
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