Remember when a minifridge was the ultimate college gift?

Today the idea of parents buying a home for their university-bound children has gone from “get real” to “get real estate,” thanks to low interest rates, a booming housing market and struggling stocks.

Parents investing in real estate around campuses is a growing trend nationwide in cities with universities, real estate professionals say.

The number of area schools – including Marquette University, the University of Wisconsin-Milwaukee, the Milwaukee School of Engineering and Carroll College – offer a lot of investment opportunities, according to Joseph A. Horning, president of Shorewest Realtors.

The rise in Milwaukee’s parent-bought houses has not gone unnoticed.

“I think that it’s definitely growing,” said Tammy Maddente, executive vice president of Wisconsin’s First Weber Group. “People have come to realize that with all that’s happened in the past couple years with the stock market, the best place to put your money is in real estate.”

Builders have noticed the parent market, too, Maddente said.

“There are projects going up in the Marquette area, where they’re looking at that as their demographic, that parents will buy a condo for students,” Maddente said. “If they’re going to be around for four years, then why put all that money into rent?”

With home prices rising 6 percent a year nationally for the past five years, that is a question some local parents are asking.

Jan Baldry, an agent with Shorewest Realtors in Brookfield, Wis., has found homes for college students “a couple of times recently.”

“The last couple of years it has grown, and I’ll tell you why: The interest rates are very desirable,” she said. “Any time the interest rates are desirable, it makes it competitive to buy instead of rent.”

Kim Erdahl and her husband, Robert, found that out when they bought a condominium in the Chicago area for their daughter, Kelsey, a junior at Roosevelt University’s Chicago College of Performing Arts.

Erdahl, of Thiensville, Wis., said they first started looking for places to rent, but “the renting situation was just abysmal.”

After calculating what they would pay in rent over the time Kelsey would attend school, they decided buying would be a good investment, Erdahl said.

The family bought the condominium in March 2002 for $145,000, including underground parking. They estimate the condominium is now worth about $185,000.

“Our goal is to sell the condo after Kelsey finishes college and, with the current rate of appreciation for high-rise condos along Lake Michigan, to net a return on our initial investment of at least seven and a half percent after we deduct capital gains taxes, real estate commissions and property taxes for four years,” Erdahl said.

For now, the one-bedroom, 750-square-foot residence overlooking Lake Michigan provides a sound investment and peace of mind, Erdahl said.

“It had to be somewhere we felt was safe, there had to be parking, and the price was right,” Erdahl said.

There are also tax benefits to buying a home, Erdahl noted.

“Kelsey does not pay rent, so we do not claim the condo as income property,” Erdahl said.

But she pointed out buying a condominium is not a free ride.

“Kelsey pays the monthly maintenance fee of $300 as her contribution to her housing expense,” she said, noting the family could afford to put money into the condominium because Kelsey earned a full scholarship.

The investment is also appealing to parents if multiple children attending school in the area can use the home.

“Many situations with siblings make it an even better investment,” Erdahl said.

The Erdahls could hold onto the property if their son, Blaine, decides to attend school in the Chicago area.

Either way, they feel buying was a good decision.

“She’s got a really great, safe place to stay,” Erdahl said of Kelsey. “And we did the right thing financially.”

If parents can afford it, investing in real estate offers several benefits, says JoAnn Vetter, an agent with Coldwell Banker Residential Brokerage in Mequon, Wis. Vetter bought a home for her son, Kyle, who attends school in Durango, Colo.

Parents “realize they can put money into real estate, that it appreciates,” Vetter said.

One benefit of owning a home near campus is the money spent on the mortgage can be recouped, unlike money spent on university housing or renting an apartment.

“We’ve done both,” said Johnny Jee, assistant fire chief for the Los Angeles County Fire Department.

The Jees bought a single-family house for their daughter, Amelia, who transferred from Marquette University after her sophomore year to attend the University of Wisconsin-Milwaukee.

As a freshman Amelia stayed in a Marquette dorm, and during her sophomore year she rented an apartment. When she transferred to Wisconsion-Milwaukee, the Jees started looking for a home to buy.

“When we knew she was staying in the area, with at least another four years of renting, we felt it was a better investment with our money,” Jee said. “We look at it as it’s always better to purchase. For example, we always purchased cars as opposed to leasing.”

Parents can either sell the home when the student graduates or hold onto it as a long-term investment, but “most people go into it thinking they’re going to do the four years or six years that their student is around and then sell it back,” said Tammy Maddente, executive vice president of Wisconsin’s First Weber Group.

Using the home as a long-term investment can work in college towns because students are a renewable resource, with a fresh crop of renters arriving each school year.

But real estate, like any investment, is not a financial guarantee.

If a student drops out of school or transfers to another area, parents may be left with a second empty nest. Most experts say at least three to five years are needed for home investment to be profitable.

After parents decide to invest in a home, they must decide what kind – for example, condominium, single-family house or duplex – and how they want to look for it.

“Most people are on the Internet looking for homes,” Baldry said.

“The family saw a condo over the Internet,” Baldry said. “It was already sold, so they contacted me and I helped them find one like it.”

The closer to campus, the better.

“Any time there is a duplex around a college campus, it’s a hot commodity,” Horning said.

Parents will sometimes buy a duplex to rent one unit out and then have their child live in the other unit and rent bedrooms to friends, Horning said. Renting part or all of a unit to non-family members can help with mortgage payments.

“If I can put enough students in there to cover costs, it’s a good investment,” Vetter said. “Looking at the down payment, many now five percent, three percent, that’s really your investment.

“Look at student housing costs – that helps you establish what price you can charge” for rent, Vetter said. “Since those rise, it’s not difficult to raise rental prices.”

Roommates can sometimes cover the cost of the mortgage, but they can also raise the level of anxiety for homeowners. Loud parties, property damage and broken leases worry many veteran landlords.

And in Milwaukee, at least, no more than three unrelated people can share a residence unless the owners have a rooming house license.

Vetter has leases with her son’s roommates and their parents. She suggests outlining the responsibilities of roommates clearly, as well as your responsibility to them.

“They have a nice place to stay, care about the property,” Vetter said. “It’s worked out well in that he found people he knew to be roommates. He was very selective.”