Is this legitimate? Why would Texas offer a program like this?
Establishing Texas residency is a legitimate and legal way to qualify for in-state tuition.
Texas Education Code (TEC) Section 54.052 authorizes persons classified as Texas residents to pay in-state tuition, a rate of tuition that is generally three times lower than for those classified as nonresidents.
Texas does not have an income tax; instead, tax revenue is generated by property taxes. By incentivizing out-of-state families to invest in Texas, the tax base grows, and the property values rise. It’s a win for everyone involved.
The University’s Office of Admissions Texas Residency page details Texas residency classifications and the requirements for establishing domicile in Texas as permitted by Texas law.
Who is Residency Realty?
Residency Realty, and its sister firm Tower Realty, specialize in helping out-of-state students attending public colleges and universities in Texas qualify for in-state tuition. Tower Realty was founded by Chesney Coker, a lifelong Texan, in 2006 and is an established leader in the off-campus housing market near UT-Austin. Residency Realty was founded to serve students attending an ever-expanding lineup of public Texas colleges and universities outside Austin (Texas A&M, Texas State, and others) through its agent/partner John Blood.
Can I talk to someone who has done this?
Residency Realty and Tower Realty has helped over 500 families (and counting) qualify for in-state tuition by purchasing real estate in Texas. Introductions to families who can give you comfort in the process and outcome are a routine part of our sales process, and we are happy to coordinate a conversation.
How does TX residency work? What steps do I need to take to get my child residency in Texas?
Generally speaking, there are three steps:
- You purchase a property in Texas.
- You establish the property as your student’s primary residence.
- After 12 months, you apply for reclassification.
Of course, there are tasks and logistics to coordinate within each of these steps, and Residency Realty has ushered many families through the process. We are with you through the entire journey, from choosing the property, negotiations, the closing, the property management and maintenance, all the way to qualifying for in-state tuition rates. Residency Realty is the Texas residency expert.
Does my child have to live in the property?
Typically freshmen choose to live on campus, which coincides with the 12-month period required for establishing domicile. Residency Realty helps owners find qualified tenants for renting or leasing the property and collect rent and troubleshoot and manage property maintenance issues.
Once your student establishes residency (typically coinciding with their sophomore year), they have the option to live in the unit they purchased.
What are the other costs associated with owning this property?
Aside from any mortgage on the property, owners can expect to pay for routine repairs to their property, as well as yearly real estate taxes, homeowners association dues, and supplemental insurance (if wanted).
How is the property managed?
Residency Realty manages your property, from finding tenants to collecting rent and paying utilities. We handle all the contracts, repairs, and upkeep. You won’t have to worry about your property when you buy from Residency Realty.
Can this law change, and I lose my investment?
According to the Texas Higher Education Coordinating Board, the number of students who met statutory requirements for establishing Texas resident status for in-state tuition under TEC 54.052(a)(3) totaled 25,930 in FY 2017, or 1.5 percent of the total enrollment at Texas public institutions of higher education.
Given the relatively small percentage of students obtaining Texas residency by these means, we do not anticipate a threat to the statute.
This issue is a state issue, not a university issue. As long as everyone is benefitting, it will remain. Texas legislature only meets every other year. Changes to the existing law would have to be introduced as new legislation, voted on, and then implemented, which is not a fast process. If you are reading this, you would be grandfathered into the current requirements.
Will I get a return on my investment? Is this guaranteed?
While real estate markets have inherent risks, and no investment is guaranteed, there is sufficient and steady demand for properties in the college area. Residency Realty has helped many families sell their condo once their student has graduated.