Although very few people take advantage of it, one of the fastest paths to significant tuition savings is to buy rental property. That’s because the biggest cost in terms of tuition is out-of-state tuition, which is typically as much as 10 times higher than discounted in-state tuition. But many students do not want to go to a university close to home, and to pay for going to a college in another state they have to pay an extraordinary amount of money.

In order to qualify for in-state or local tuition discounts, you have to be a resident of the same state where the college campus is located. The way that most states verify residency is that they require that you can either prove that you have lived in the state for at least a year – by showing them things like utility bills or tax returns. But many states also allow residency status to people who own real estate in their state. Owning real estate means you have to pay local taxes, and it is those taxes that fund or subsidize tuitions to make them more affordable.

So you can buy a home – even if it is just a small condo – in a college town. Your kid who is going off to college can live there and share the rent with another student to help generate some rental income to pay the mortgage. Buy a house and you may be able to rent to several students and even make a profit on your college town rental property. If owning the home qualifies you for in-state tuition discounts, the money saved on a college tuition over several years is probably enough to cover the whole down payment.

Owning rental property also allows you some tax deductions for landlord-related expenses like trips to go check on your property, so you may be able to deduct the cost of visiting your child while they are away from home by combining the visits with your landlord responsibilities. Once your child graduates you can either sell off the real estate or keep it as rental property if it is a profitable venture.