Student housing is a lucrative market and will likely remain so in the future. Universities will always have new students who need affordable housing close to campus.
However, renting to students is different than renting to older adults. For one, students rarely have much or any prior renting experience. They’re likely to be unfamiliar with rent payments, utilities, maintenance requests, and other renting basics.
Student renters may also host parties, cause noise complaints from neighbors, or neglect repairs and cleaning. Plus, a typical undergraduate only needs housing for two to three years. This short period means high turnover for your business.
Despite these concerns, many students make great renters. Students are often supported by their parents, who have funds and experience. Renting to students also puts you in a strong position financially, as your units are likely to be in high demand year after year.
Student housing provides ample opportunity for filled units and steady revenue.
Below are four tips for navigating the student housing market.
1. Use Campus Resources
As a landlord who rents to students, you won’t need to budget much for advertising. Students will find you, especially if your properties are close to campus.
However, when you do advertise, take advantage of campus resources. College campuses are densely packed spaces where students congregate in central locations like libraries and student centers. Paper flyers, while relatively ineffective for regular rental units, are likely to work in college towns.
In addition to listing your properties online and syndicating them across a few sites, remember to post some physical ads on site.
2. Require a Co-Signer
Students, as inexperienced young adults, don’t always make the most reliable tenants.
For one, university students often take on debt prior to entering school. Most will have just graduated from high school, during which they may or may not have had a part-time job. Either way, they aren’t likely to have large savings accounts.
Nor are students likely to be long-time credit card holders. They won’t pass your typical income minimums and credit checks.
One way to solve this problem is to require student renters to sign their leases with a co-signer or guarantor. This person, usually a parent, shares responsibility for rent payments with the student. If the student’s income is insufficient, their co-signer is obligated to step in.
If you choose to require co-signers for student renters, be sure you screen not only the student, but also their co-signer. This means performing credit, criminal, and eviction checks for all lease signers.
3. Sign Individual Agreements with Roommates
Many students will rent apartments with one or more roommates.
If you rent multi-bedroom units, be sure to specify in your lease how you plan to allocate rent and bill responsibilities.
One option is to hold tenants jointly and severally liable, which means that all roommates together, and each roommate individually, is equally responsible for paying rent and fulfilling the lease terms. This is considered an advantageous option for landlords because if one roommate defaults or damages the property, the others are responsible for fulfilling their roommate’s financial obligations.
However, as you can imagine, this situation might be infuriating for the other roommates. In many cases, signing individual rental agreements with each roommate is a better option. This leads to fewer arguments and conflicts between renters, as each signs their own lease and is only responsible for their portion of the rent.
Roommates can still be jointly responsible for common areas like kitchens, bathrooms, and other living spaces.
4. Use Online Rent Collection
Students in 2022 are tech-savvy.
There’s no reason not to use digital rent collection with your college-aged renters, especially as most students are already accustomed to this method for paying bills.
If you aren’t already, consider using a property management app to collect rent along with tenant screening, lease signing, maintenance management, and other landlord tasks.
Student renters will have no trouble making an account, paying bills online, submitting maintenance requests, and signing digital leases. Most would prefer to do so online anyway.
Conclusion
Student housing is an incredibly profitable market for many property owners. The low vacancy rates and high demand is often worth the additional risk and turnover. By following these four tips for leasing to students, you can also reap the benefits of this rewarding market.
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