I also own a condo at 22nd and Chestnut that is currently on the market. In about 2 weeks it will be rented out to students at $1800/month which is a bit below market because it is a short term lease. This location is walking distance to Drexel and a great center city location near everything. It is 2 bed and 1 bath about 1010 sf. Contact me at email@example.com. The MLS# is 5336702.
Also, bear in mind that students (not your kids, but the renters) will trash the property. Just completely trash it. I bought my first house ever, in University City, for a song because it had been trashed by student renters (even though the owner's son lived there too, as he was also going to UPenn). (I paid more to renovate it than it cost to buy it - even with doing the work ourselves.) Don't plan on renting to students unless you like doing total rehabs every couple of years. That's the real reason why student rentals are crappy and expensive - students drink and trash their apartments. They trash them when they're happy; they trash them when they're sad. Then they leave town. Most grad students aren't any more responsible (or cleaner) than undergrads.
Probably you should rent something for your kids until they figure out where they want to live anyway.
I lived in University City for about 30 years, and graduated from Drexel's MBA program. I've had rental properties, and I shared my own residence with paying renters for many years -- Drexel students, Uof P students, Temple students, professional people, etc. So, I know the area. The concept of buying a home for your son/daughter and having them share it with paying housemates to offset costs is a common one. A Drexel student would be closest to Drexel if they lived in Powelton Village (a part of University City). But, the RE values tend to be a bit prohibitive in Powelton & the houses tend to be very large. Probably not your best investment choice (for a student), but a good area. West Powelton is a developing area, and that could be an option. Also, Drexel is, in fact, close enough to center city Philadelphia for that to be an option. But, a student would likely be happier living closer to other students in U.C., and the cost of housing (rents or sales cost) is cheaper in UC versus Center City. So, my recomendation would be to concentrate on looking in UC -- which is a fairly large area. 44th, 45th, 46th, 47th, 48th -- even 49th & 50th Streets are fine. South of Baltimore Avenue is fine. North to Market Street is fine. As you get to the outer bounderies, the housing stock will be a bit more "run down". But, there will also be "jewels" mixed in. This is where you will maximize your return on investment. If you get too close to Penn's campus ( 40th St, 41st St, 42nd St.) you will be surrounded largely by rental properties with college students. Many are owned by absentee landlords and may not be well-maintained. I personally would not want to live there, but a college student probably would. For true investment purposes, tho, I'd look further west. Your best bet is to go to the websites of the University City real estate offices (there are 3 -4 major ones) and look at the listings. Then go to one of the Realtors, and see the properties. They will give you a good feel for the neighborhood(s). Urban & Bye RE is probably the largest, O'Donnell RE is another. But there are others.
One caution, though: It is illegal to have more than 3 unrelated people living in a single-family home in Philadelphia. Many of the problems in UC come not from criminals, but rather from the bad behavior of (usually) undergraduates living in group housing situations (large keg parties till 5AM, fights, etc.) UC neighborhood associations and non-student "working stiffs" will enforce the regs when they can. So, I would think in terms of a house big enough to house your sons plus no more than 2 others. Also, be aware that old houses often need maintenance. So, plan on buying a renovated house, or plan on putting some $ into maintaining or improving a non-renovated one.
Again-- don't believe the "bad press" that non-informed people will tell you about Univercity City. It can be "gritty", and there are many different types and nationalities of people there. But it is no more safe or unsafe than other areas (well, maybe a bit safer.)
You can look in the West Philly area or in Center City close to the Walnut St. bridge. I would say Grad. Hospital too but the South Street bridge is going to be closed soon for renovations.
If you tell me how much you'd want to spend I can send you some properties.
Please don't hesitate to e-mail me or call me on my cell.
Keller Williams Realty - Center City