Buy a rental property early, let tenants pay the mortgage, eventually sell it, or keep it as a lifelong income-generating asset.

What if you could use real estate to set up your kid’s college fund before they’re even born? It may sound unconventional, but using it to fund a child’s college education is both practical and achievable. The concept is simple: purchase a property, rent it out, and just forget about it! While there are a few important steps involved, the overall approach is straightforward.

Start early and let the market do the work. Buying a property before your child is born, or while they’re still very young, gives you a major advantage. By renting it out, the mortgage is covered, and the loan is secured. Over time, two powerful forces begin working in your favor: appreciation and rising rental income. In strong markets like the Phoenix metro area, job growth, population migration, and nearby universities support steady increases in both property values and rent.

A well-timed purchase like this can eventually run on its own. It may just break even at first, but as the mortgage goes down and equity builds, the value of the property often grows—sometimes slowly, sometimes significantly.

“In strong markets like the Phoenix metro area, job growth, population migration, and nearby universities support steady increases in both property values and rent. ”

Equity, ownership, and real-world experience. When your child turns 18, the property gives you real flexibility, and even if it isn’t fully paid off, it likely has plenty of equity. You can sell the property to pay for college or take out a loan against it, while rental income continues to cover both the mortgage and tuition.

What makes this even more valuable is that your child gets to keep the asset. Along the way, they’ll learn how to manage the property, collect rent, handle maintenance, and navigate real situations like tenant issues or evictions. These hands-on experiences build long-term financial skills. Compared to traditional savings plans that require years of paycheck deductions, this is a one-time, mostly leveraged investment that grows on its own and offers more than just financial returns.

Investing in real estate for your child’s future isn’t just about the financial gains. It’s also about teaching responsibility, giving them an early start, and building something that lasts. We at Good Company Real Estate can help guide you through this. If you have any questions, feel free to call us at 480-267-9368 or send an email to Office@GoodCompanyRE.com. We’re happy to help.