In most cases, properties located on or nearby college campuses are extremely profitable. As new students come and graduates go, the need for practical housing remains. Most college-age renters prioritize proximity and accessibility to convenient transportation when looking for a place to live in while attending school, but also as they transition into their post-graduate jobs: a large number of universities reports a growing trend for graduates to remain in their college towns as opposed to relocating home whenever possible. Simply put, being able to cater to a local student demographic can almost guarantee continued demand from new renters, and in high-demand locations - where the number of students looking for housing surpasses availability of affordable or available properties - a property without particularly appealing features or amenities can still be feasibly rented.
However, while college students might be able to secure profit and turnarounds, they remain a one-of-a-kind tenant demographic that should not be underestimated. Their age, lifestyle, and overall needs are all important factors that a homeowner and/or property manager must take into consideration: this week’s article will lay out how and why renting to college students it’s a practice that deserves special attention and precautions.
Low vacancy - as outlined in the introduction, what is unique about properties located nearby colleges is that they attract a steady stream of prospective renters. As new students join the university and graduates depart, there will always be students looking for housing that allows them to live nearby their school. This is advantageous as it makes the likelihood of properties remaining vacant is very low.
Leveraging value - while this changes from college town to college town and is largely dependent on the overall size of the student body of a particular university, in most cases homeowners and/or property managers can easily demand higher rent prices for properties that would typically be worth for far lower (as far as size, amenities and special features are considered). In high-demand years, in which a particularly high number of students is looking for off-campus housing, it is possible to tailor rent to demand and secure particularly high profits.
Necessity - typically, students are rather low-maintenance. Their top priority is their ability to easily travel to their university and be able to enjoy greater freedoms than they would in their family home or in a college-owned dormitory, which a nearby rental would grant them. Keeping college-age tenants satisfied should be fairly easy and does not require being able to offer a property with high-end features.
Turnarounds - This point can be seen as both a positive and negative aspect of renting to a college-age demographic. If a homeowner or property manager prefers the consistency and stability of having a long-term renter, students are unlikely to fulfill this expectation. For most properties, it is rare enough for the same renter - or group of renters - to live in the same property for all four years of their college experience, with most renter typically only sticking around for one school year at a time.
Inexperience and Immaturity - college students are new to renting, with most having no renting history/references to look over and evaluate, as well as little to no knowledge of what committing to a lease - and rental payments being due - really means.
Lifestyle - while this is not guaranteed in every case, it is not uncommon for college students to be inconsiderate of their surroundings as they are too busy with school or with enjoying themselves a little too much. Throwing parties, playing loud music and simply not being too preoccupied with keeping the space clean and tidy can come hand- in-hand with a college-age tenant, and compromise the actual conditions of a property.
Damage - with their unique lifestyle come unique wear and tear. The aftermath of parties and opening a property to tenants who view it as a very temporary space can lead to it being damaged by accidents or the mere disregard of tenants.
5 Helpful Maintenance Tips for Property Managers & Landlords
1. Demand Higher Deposits and Guarantees: when it comes to opening a property to unreliable tenants, it’s definitely better to be safe rather than sorry from the very start. Demanding higher security deposits and even the involvement of parents or guardians who can co-sign and agree to step-in and cover repair costs is one of the best ways to stay protected.
2. Rethink Pet-Friendly Policies: for some college-age renters, being able to own their very own, first pet is one of the freedoms they seek alongside independently living in a place of their own. While allowing pets in a property - even with a higher security deposit to match - can make it stand out as the ideal place for pet-loving students, it can easily increase the gravity of damages that might occur. Younger pet owners are not always the most responsible, especially when being busy with academics and extracurricular interests. To avoid the damage caused by unsupervised pets, it might be best to avoid allowing tenants to own them completely, and make sure to proactively check whether tenants are “sneaking” pets into the property when they should not be.
3. Invest in Regular Checkups: the best way to avoid finding a property suddenly presenting costly damages - like at the very end of a tenant’s occupancy period - is to schedule regular maintenance checkups. Tenants should be informed from the start of their occupancy that seasonal checkups and inspections will be performed in the property as this will help holding them accountable with prioritizing taking care of their space.
4. Structural Upgrades Come First: when thinking about upgrading or touching-up a certain part of the property - especially as a part of a “rental turn” - it’s important to think of what would be most helpful in adding an extra line of protection for the property. While tenants might love a brand-new stove, your money will probably be better spent turning a “damage-magnet” - like carpet flooring, which is prone to stains, discoloration, bad odors and tears - into a low-maintenance, practical feature.
5. Consider a New Maintenance Solution: with inexperienced tenants come a lot of emergencies, from accidental damage to practical, everyday concerns. Some tenants might have no idea how to operate a garbage disposal system or change a lightbulb, which translates in frequent calls for help. Property managers overseeing a large number of properties will likely benefit from relying on a maintenance professional who can be on-call and step in when needed.