If you’re considering investing in student housing near a university, there are a lot of things to consider. The appeal is certainly there — property near colleges is easy to fill and almost guaranteed to have full vacancy during the school year, provided it’s priced appropriately. These properties are in highly desirable areas, and if there’s easy access to transportation, you’ve got as close to a sure thing as you’re going to find. So what should you consider? We have a few thoughts.
Where will I find applicants?
College students need affordable housing, but they’re also pretty new to renting. In fact, this may be the first property they ever rent! They may not know the ropes yet and you’ll have to deal with a bit of a learning curve. You can feel free to advertise on campus and online, as both will bring in a steady stream of applicants. Some campuses even have special programs where off-campus housing can advertise. Keep in mind that you can afford to be choosy — there will always be more students. A screening service is a good start, though younger tenants may not have much in the way of rental history yet, so you may need to collect additional information about their parents or income.
Won’t my rental be empty during the summer months?
Not if you plan appropriately. Summer vacancies are a given when many students are set to go back home for a few months, but you can always consider month-to-month leasing for seasonal workers or students enrolled in summer classes. Depending on your area, you may even be able to rent it out as a vacation property. Some students may want to stay the summer, as well. Make sure you factor this in to any rental agreements you make. Either way, it’s wise to plan ahead for the possibility of a few months’ of vacancy and have an emergency fund in place.
So what should my lease term look like?
It may take a year or two to get into the rhythm of things, but as you begin to understand how your particular campus works, you’ll be able to adjust for an appropriate lease term. College students may not want to be tied by agreements lasting longer than six months, but rarely you may find those willing to sign a lease for nine months or even a year. Considering month-to-month rental is another option, but be sure to check your local regulations and understand that this can mean a tenant leaves you high and dry with little warning.
Do I need to worry about property damage?
To be frank, property damage is always a concern, no matter who you’re renting to. This is why a tenant screening service is so highly recommended — it may not tell you much about a young renter’s rental history, but you can glean some information about criminal background or credit. Many students will receive financial help from their parents, and it’s not unreasonable to include a screening for them, as well. As always, make sure you have a solid rental agreement in place and have a regular repair person on call should the need arise. College students may have a reputation for partying, but they also need their housing to attend school. You should be able to find tenants who aren’t willing to risk trashing their rental.
As always, we recommend our RentalConnect program as an added tool for selection the right tenants for your property. RentalConnect offers property owners and landlords a great alternative to the expense of full tenant screening. This service requires no on-site visit, sign-up, or membership fees, making it extra convenient. The $34.95 service fee is paid by the applicant. Available 24/7, RentalConnect is fast, easy, secure, and delivers reports needed to make an informed decision, including a credit report, a national criminal search, and a national eviction search. Reach out to us for more details!
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