If your property is in the vicinity of a college campus, you are in the prime market for college student renters. There are some risks and hurdles to having college students as tenants, but there are also some major perks.
Of course, many landlords have their doubts when renting to a younger demographic, however, this is an opportunity that should not be ignored. With some strategies to minimize risk, you can be on your way to a lucrative rental property.
Pros of Renting to College Students
College students tend to have a bad reputation when it comes to renting a property, however, there are plenty of perks when it comes to renting to students.
1. High Demand
If there are colleges, there will be a need for student housing. Schools can only house so many students, so properties within walking, biking, or short driving distance to campuses are extremely desirable. Additionally, this demand happens each year, which means there is never a worry about vacancies.
Property managers can take advantage of high demand by starting the leasing process earlier than normal to help students secure housing for the following year. In a college town, you can begin signing leases as early as February for the following fall semester to ensure your property will not be vacant. Plus, if you have a home you've just moved out of near a college,
converting the property into a rental unit can be beneficial.
2. Potential for Higher Rental Income
Students are looking for affordability and tend to split rent with roommates. This allows property owners to structure rental income differently. For example, you may charge a family $2,000 a month to rent your 3-bedroom home, but will be able to charge $2,250 for college students, which works out to be more affordable for students at $750 per person and more money in your pocket.
3. Low Marketing Costs
Being so close in proximity to a college campus reduces your need for marketing. Word of mouth tends to fill vacancies, and it is not uncommon that friends of previous tenants request to take over the lease.
You can also work with student housing to promote your listing and post to student forums. This allows you to spend less time trying to market your property, and more time on important tasks such as maintenance.
Cons of Renting to College Students
On the other hand, many property owners are reluctant to rent to students because of the potential risks associated. Students may not be the most responsible, mature tenants so here are a of couple things you should look out for.
1. Lack of Rental & Credit History
Because college students are young and likely have little to no experience paying bills, screening can become challenging. An easy solution to this issue is requiring a cosigner on the lease, typically a parent.
Adding the parent’s name to the list will make them financially responsible for payments and covering damage costs. Be sure to screen the cosigner and require a security deposit.
2. High Turnover
There is always
going to be a high turnover rate
in the student housing market because students are often in and out of their college in our years and typically do not live in the same place the entire time.
To combat this, offer perks for repeat tenants or referrals. A short-term summer lease or discounted summer rate could help eliminate vacancies after the academic year has ended.
3. Property Damage
You may deal with a combination of noise complaints, lack of maintenance, and increased wear and tear of your property when renting to college students.
College students are for the most part living on their own for the first time and might not understand the value (or their legal responsibility) for maintaining their home.
The best way to prevent issues is to
communicate with your tenants regularly . Ensure that they know who to call when they experience a maintenance issue. Additionally, requiring a security deposit and rental insurance will help you prepare for unforeseen damages that may occur.
The benefits of renting to college students outweigh the risks. Due to the high and constant demand for housing near campus, this could be a lucrative source of income. As discussed, it is important to screen all potential tenants and cosigners to ensure they will be reliable renters. Add both parents to the rental agreement as co-signers so they are responsible for any damages to your property and can be held accountable.
By renting to college students you can charge a higher rent while making fewer costly upgrades to your home. By limiting risks and taking appropriate precautions mentioned above, renting to college students can be a very profitable stream of revenue for you. The constant flow of potential tenants, high demand for rentals, and competitive rent prices in college areas creates a strong rental market and profitable investment opportunities.
This post was written by the trusted home service experts at
Ambassador Window Cleaning,
who specialize in window cleaning, pressure washing, and awning cleaning in Charleston SC.
