Millions of students across the country are relying on distance learning for their education, thanks to COVID-19. Even university students have had to miss out on the "college experience" because their schools have remained closed due to the virus. And we can't forget that many employers are also allowing the employee who can work from home, to work remotely!
We know that the health crisis continues to wreak havoc on our economy, but one has to wonder what COVID-19 is doing to university cities that rely heavily on students - both as consumers and employees.
In the HomeLight Q3 survey, 1,000 real estate agents say the economy and housing market in college towns are struggling. Here are a few examples of the impact the virus is having on college towns.
From thriving cities to ghost towns
As colleges and universities cancel in-person classes and are implementing distance learning instead, university towns aren't doing so well. They've become a shell of what they once were but 38% of the top agents who participated in the survey said they recognize the danger this is for the housing market.
Agents from these towns predict property vacancies will increase, rising above the 5.2% in the 2019 fall semester to 7.4% for the 2020 fall semester. Even vacancies by unit would increase to 3.3%, a 1% increase from 2019's 2.3%.
Unaffected cities are the exception
Not all college cities have been affected by the pandemic. The universities that decided to allow in-person classes are still thriving. As a result, the town's economy and rental market are faring pretty well.
It is worth noting that it all could change if universities do decide to switch to distance learning. This could be for the best because the students who were living on campus would be likely to search for rental properties nearby just in case the school opens again.
Investing in real estate is uncertain
Approximately 30% of real estate agents said the number of investors who are buying rental properties are about the same or on the decline. Depending on the market, it could be a serious concern - no students means there's no one to rent the property! 15% of agents said they're seeing the number of vacant rental properties are on the rise.
On the other hand, if you're a gambler and still want to invest, you're in luck because 19% of agents said there is a boost in the number of houses that are for sale because landlords aren't able to find qualified renters.
Fluctuating inventory
To build on the previous point, 30% of participating agents said the number of rentals are about the same or are declining from the pre-pandemic vacancies. It's true that each housing market is different, but it's pretty telling when 81% of agents say the local inventory is at an all-time low even though many landlords are listing their properties.
The stark reality is this: COVID-19 has thrown our lives into chaos; and although real estate as a whole has been relatively stable, university towns are teetering. Local businesses who rely on student employees and patrons are struggling because there are little to no students in the city!
We're keeping our fingers crossed that in-person classes will restart in Spring 2021 - not only for students to get their money's worth, but so the economy and housing market will make a comeback.
