Millions of students flood college towns every fall, bringing along parents, alumni, and sports fans eager for a place to stay. Can this reliable demand be turned into a profitable rental business?
You bet—provided you know how to pick the right college town rental market.
Booming college town rentals
In 2020, about 19.4 million students were enrolled in U.S. colleges and universities. This sizable student population creates strong rental markets in college towns, especially for short-term rentals, which benefit from a steady flow of university-related events.
To help investors like you, we’ve collected five of the best college towns for short-term rental investments, evaluating rental demand, market conditions, and local regulations.
Are you considering investing in college town rentals? This guide can help you find the most promising locations for substantial returns.
Start your application with Park Place Finance1. Austin, Texas
With more than 50,000 students and 19,000 faculty, the University of Texas at Austin is among the largest public universities in the United States.
Austin’s lively culture, booming tech industry, and full calendar of events make it an excellent choice for short-term rental investments.
Rental demand
Austin draws a diverse range of visitors, from tech professionals attending conferences to parents visiting their college-aged children.
Major events, such as South by Southwest (SXSW) and the Austin City Limits music festival, significantly boost short-term rental demand. Additionally, Texas Longhorns football games bring thousands of fans each season.
Real estate market
Austin’s real estate market is competitive, with a median home price of about $580,000. The potential for short-term rental income is high, particularly for properties near the university or downtown areas.
Regulatory considerations
Austin has several mandatory short-term rental (STR) regulations. Investors must apply for a short-term rental license, comply with zoning laws, and adhere to occupancy limits.
Reviewing city guidelines is essential before purchasing an STR property.
2. Gainesville, Florida
Gainesville, home to the University of Florida, offers strong rental demand due to its large student population and a steady stream of visitors for academic events, football games, and alumni reunions.
Rental demand
With over 50,000 students enrolled, the University of Florida ensures consistent rental needs. Gators football season also drives a surge in short-term rentals as fans travel to attend home games.
Real estate market
Gainesville presents an affordable investment opportunity, with a median home price of around $300,000. The lower cost of entry compared to larger metro areas makes it appealing for investors looking for strong returns on college town rentals.
Regulatory considerations
Gainesville has significantly relaxed its short-term rental regulations, which has added to its appeal for investors.
As of October 1, 2021, Gainesville no longer requires permits or licenses for rentals under 30 days, and short-term rentals are now allowed in Residential-Office and Residential-zoned properties.
3. Columbus, Ohio
Columbus is home to Ohio State University (OSU), one of the largest universities in the nation, with more than 65,000 students.
The city’s robust economy and expanding technology sector make it attractive to real estate investors.
Rental demand
OSU’s massive student body and its role as a major research institution contribute to steady rental demand. Columbus also attracts visitors year-round for university-related events, sports games, and business conferences.
Real estate market
Columbus is relatively affordable, with a median home price of about $268,000. The city’s growing population and economic expansion provide a favorable environment for short-term rental investments.
Regulatory considerations
Short-term rental regulations in Columbus require investors to register with the city and adhere to zoning laws.
Additionally, specific neighborhoods have restrictions on STR operations, so investors should research local policies before purchasing a property.
4. Nashville, Tennessee
Nashville is home to multiple universities, including Vanderbilt University, Belmont University, and Lipscomb University. The city’s renowned music scene, cultural attractions, and booming tourism industry drive high short-term rental demand.
Rental demand
Beyond the student population, Nashville draws millions of tourists annually for its live music scene, festivals, and business conventions—more than 16 million visitors in 2023 alone.
Events like the CMA Music Festival and NFL games further boost demand for college town rentals.
Real estate market
Nashville’s median home price is approximately $545,000. While higher than some other college towns, the city’s strong rental income potential helps offset initial investment costs.
Regulatory considerations
Nashville has implemented strict short-term rental regulations, requiring permits and zoning compliance. Additionally, non-owner-occupied STRs are prohibited in certain residential areas, so investors must carefully research locations that are allowed.
5. Knoxville, Tennessee
Knoxville, home to the University of Tennessee (UT), offers investors a blend of affordability and strong rental demand. The university’s sports culture, particularly its SEC football program, brings consistent visitor traffic.
Rental demand
Knoxville sees a surge in short-term rental bookings during football season as thousands of fans travel to watch UT Volunteers games. The university also hosts academic conferences, reunions, and prospective student visits, supporting STR demand.
Real estate market
Knoxville is an attractive market with a median home price of around $423,000. The lower price point than larger cities makes it accessible for investors seeking high cash flow potential.
Regulatory considerations
Knoxville allows short-term rentals, but investors must obtain a permit and adhere to occupancy limits.
Some neighborhoods may impose restrictions, so checking local zoning laws before purchasing a property is important.
Essential considerations for college town rental investments
- Local regulations: Many cities enforce zoning laws, permitting requirements, and rental caps for short-term rentals. Investors should verify local regulations before purchasing a property.
- Seasonality: Demand for college town rentals often fluctuates with the academic calendar. Investors must account for peak seasons, such as graduation weekends and sports events, when setting rental rates.
- Property management: Short-term rentals require active management, including guest communication, cleaning, and maintenance. Hiring a property management service can help streamline operations and maximize occupancy.
- Proximity to campus: Properties within walking distance of universities often command higher rental rates and occupancy. Location is a key factor when evaluating potential investments.
Capitalize on the demand for college town rentals with Park Place Finance
Investing in short-term rentals near major universities can deliver consistent income and high occupancy rates.
Choose Park Place Finance for competitive hard money loans to help you secure prime rental properties quickly and efficiently.