In Utah, more parents are buying homes for their kids who are going to college. “A lot of investors in Utah are parents buying homes for their kids in college at BYU or the University of Utah,” said Sam Brinton, a Redfin Premier agent in Salt Lake City.
“In Provo, many of the purchases within a mile of BYU are parents buying for their kids, and potentially for their kid’s friends, who will pay rent. They figure, why pay rent for four years when they can own a home and hopefully sell it later at a higher price?”
Meanwhile, a possible Fed rate cut in September could help US homebuyers save an average of $20,569 over 30 years if mortgage rates fall from 6.29% to 6.00%, according to a study by HomeAbroad and Ziffy.ai. Lower rates would also reduce the annual income needed to qualify for a mortgage by about $2,448, with even greater savings in expensive areas. This could make it easier for middle-income buyers, such as teachers and first responders, to purchase homes in markets that were previously too costly.
Affordability remains in the Rust Belt
Coastal and mountain college towns are the most expensive, but the Rust Belt is much cheaper. Dayton, Ohio, is the most affordable college town in the country, with a median home price of just $137,261. Syracuse, New York, and Mount Pleasant, Michigan, are also among the least expensive, with prices below $202,000.
Rising home prices in college towns highlight bigger affordability problems across the US housing market. With costs climbing, more people are turning to mortgage professionals for creative loan options and pushing for policy changes. Jeff Brown, founder and CEO of T2 Capital Management, said it’s important for investors and brokers to assess each school before moving forward.