"College towns have a natural cycle of tenant flow," Realtor.com's Jennifer DuBois said. "You know [a student] is going to be in town for four years -- and when they move out, the next bevy of students will be moving in."
DuBois says parents who face big tuition bills might find buying a rental that their child can live in while at school will take some sting out of high college costs.
"Owning a condo that your child can live in while at school can make a college education more affordable, depending on how long you hold it and how much home prices appreciate," she says. "It certainly won't pay for an entire college education, but it's a good way to at least get some money back."
To help investors and parents find the best returns on college-area real estate, Realtor.com recently analyzed market conditions in cities hosting the top 25 national universities in U.S. News & World Report's annual school rankings.
The five cities below offer the highest rents relative to what you'd pay each month on a mortgage for a typical property in each locale.
All rental prices refer to average asking rents on Rentbits.com as of July, while monthly mortgage bills reflect what you'd pay for a median-priced home advertised on Realtor.com for each city during the same period. (The study assumes you'd take out a 30-year-fixed mortgage with 20 percent down and today's average interest rate of about 3.6 percent interest rate.)
College Towns Where It Pays to Be a Landlord
Want to Rent to College Students? 5 Cities Where You'll Get the Most Bang for Your Buck
Fifth-best city: Atlanta Difference between rent and mortgage: 182.6%
DuBois says "Hotlanta" offers investors the potential of good rental income and solid capital appreciation.
That's because the 5.3 million-population metro area's real estate market -- which tumbled during the housing bust -- appears to be rebounding. Median Atlanta-area list prices on Realtor.com rose 9.8% over the past year to hit $174,900.
"Atlanta was hit hard by foreclosures, but prices are starting to appreciate there and I think we're seeing some stability," DuBois says.
Fourth-best city: Princeton, N.J. Difference between rent and mortgage: 209.8%
Rents in the home of 7,900-student Princeton University average $2,056 a month -- more than double the $980 monthly mortgage bill on a typical home in the area.
Besides hosting a world-famous school, Princeton serves as headquarters for Berlitz, the Educational Testing Service and other large local employers. Bristol-Myers Squibb (BMY), Dow Jones and other big firms also have significant operations in the area.
Third-best city: Pittsburgh Difference between rent and mortgage: 215.8%
The Steel City and surrounding communities are home to more than a dozen schools, from the 28,800-student University of Pittsburgh to 12,100-pupil Carnegie-Mellon University.
Buyers will also find the lowest home prices and monthly mortgage bills of any town on Realtor.com's list.
The median Pittsburgh home listed for just $140,000 as of July, with an estimated monthly mortgage payment of $520. That's less than half the average $1,122 asking rent investors can expect from tenants.
Best city: Boston Difference between rent and mortgage: 248.7%
Boston is perhaps America's biggest college town, with more than 100 schools and more than 250,000 students.
Best known as the home of Cambridge's Harvard University (19,900 students) and the Massachusetts Institute of Technology (10,900 enrollees), Beantown also hosts Boston University (32,400 pupils), Northeastern University (19,700 attendees) and other large schools.