Last year, Raleigh resident Mitch Miller paid about $800 a month, sometimes a little more, in rent for his 19-year-old son to live in Wilmington and go to school at Cape Fear Community College.

“As the months go on, I’m looking at our bank account and thinking, ‘We don’t have any equity; it’s just paying rent,’” Miller said. “And if he does another year at Cape Fear, perhaps transfers to UNCW and maybe gets a job down here or he graduates and leaves, well then, we’ve got four years of $800-plus a month and nothing to show for it.”

Miller’s son, Seth, would have a degree, of course, Miller said, “but still, I mean, that’s a lot of money to pay for living expenses. So one day I was thinking, we should see if we could find a place to buy down here because we like coming to Wilmington.”

In the months leading up to the start of school this month for CFCC and University of North Carolina Wilmington students Miller wasn’t the only parent whose thoughts were turn to housing costs for the upcoming year. The Wilmington market offers a variety of choices in addition to on-campus living in the case of UNCW, including recently constructed student apartments off campus and other rental homes, condos and townhomes.

Stephanie Lanier’s residential real estate company, Lanier Property Group, fields calls about the sales market for potential student housing mainly in the summer but also at times during the winter break.

“Parents want to know does it make sense to buy an investment property, what do the numbers look like, and we try to give them really good information about what would be the best fit for their family and their student,” said Lanier, CEO of Lanier Property Group. “It depends on a lot of factors, the most important one being how long do they think their student’s going to be there and would they keep it as an investment afterward or would they resell it.”

As he was pondering the idea, Mitch Miller decided to take a day off from his job as a pharmacist in June to look around the area, making an appointment with Lisa Sahlie, a broker with Lanier’s firm.

“I just came down to look and this place happened to be for sale,” he said of the property his family ended up buying – a two-bedroom, two-bathroom townhome in the Merestone subdivision off George Anderson Boulevard – for Seth Miller to live in. “It had just gone on the market that morning.”

That same day, Sahlie had suggested that if Mitch Miller liked it, he should put a bid on it, warning, “It will be gone tomorrow.” 

The townhome fit the Millers’ criteria of a dwelling with a price under $160,000. In Wilmington, homes under $300,000 are in high demand, with rapidly shrinking inventories the lower the price goes, according to Wilmington Regional Association of Realtors statistics.

Immediately, the Millers had to bump their initial offer up as other offers for the property came in the same day, but the family won out for a price of $124,253 with a mortgage interest rate of 3.75 percent. Monthly, the bill for the home is about the same as what the family was paying in rent for the apartment Seth Miller used to live in, but that’s factoring in taxes and insurance. 

“Over time, the way I saw it and still see it, you’re investing in your own property so at the end of the day you still have some property to call your own,” Mitch Miller said.

Some students don’t have the option of living off campus. For the first time at UNCW, freshmen whose primary residences are outside of the tri-county area are required this year to live on campus.

“The university recognized that students who live on campus persist at higher rates. They become more involved on campus, and in a drive to continue our efforts to enhance retention, it was decided that we should have the students who were from outside the area live with us,” said Peter Groenendyk, director of housing and residence life at UNCW.

That has translated to about 2,120 freshmen (as of Aug. 1) expected to live on campus this year out of a total of 4,200 on-campus student residents, he said.

It’s difficult to compare the costs of living on campus to living off, Groenendyk said, because different off-campus apartment communities offer a variety of amenities. But on-campus housing fees, which range from about $5,200 yearly for 10 months in residence halls to $7,163 for the apartment-style Seahawk Crossing, include all utilities. 

“One of the things that we are currently in the process of is the development of a 10-year master plan for university housing,” Groenendyk said. “And one of the things that plan will look at is the university’s enrollment objectives. It will do a market analysis both benchmarking us against our competitors and the off-campus market. We’ll be getting a tremendous amount of student feedback on the sort of housing they would like to see, and then off of that we will have recommendations sometime in the early spring about whether or not we should be building additional housing.”

Along with a boom in the area’s overall apartment market has come new student rental properties. 

“Between the years 2013 and 2015, a total of seven purpose-built ‘by-the-bed’ student housing projects with a total of 760 units and 2,109 beds were added to the UNCW market,” said Richard Cotton, a broker and managing director of Multifamily Realty Advisors who specializes in the sale of apartment projects and apartment development sites. “Most of these projects last year were able to maintain occupancy of over 95 percent, and some were able to maintain 100 percent occupancy most of the year.”

One of the newest to cater to students is the recently completed Aspen Heights Wilmington, which includes duplexes and cottages on South Kerr Avenue near UNCW. 

Jared Styles, regional manager for Aspen Heights, said that the community was pre-leased at 75 percent, with a third of the residents who’d rented apartments already having moved in and the rest expected on UNCW’s move-in day Aug. 13.  

Cable and internet are included in the Aspen Heights rental rates of $690 per room in a four-bedroom cottage and $710 per room in the duplexes. 

“We have 1G fiber [internet] going to all the houses, which our residents love,” Styles said. “All residents have access to our amenities which include grills, hammocks, pool, hot tub, gym, game room and study center.”

Mitch Miller said his son’s former apartment was “a nice setup because it’s all students, it’s a furnished apartment. He had just gotten out of high school and didn’t have his own furniture. They’ve got a swimming pool, student activities, socials.”

But the financial aspects in addition to being able to own a second home near the beach helped persuade the Millers to buy. 

“Most people that we’ve helped end up keeping their investment property after the student graduates,” Lanier said. “Most of the time, people are keeping them for three to 10 years, maybe more. But we say, ‘the longer, the better.’ That’s just generally good real estate advice.”