If a rental property is near a college campus or in a college town, it is a hotspot for college student renters. According to the College Board, 44% of college students live off-campus, which translates to millions of students seeking accommodation each year.
Of course, many landlords are hesitant to rent to this younger, less mature demographic. But, with such strong demand, minimal vacancies, and the potential to charge a competitive rate, property owners can't afford to pass up a chance. And, with a few risk-mitigation methods in place, one could be well on their way to a lucrative rental business.
What Do College Students Look for in a Rental Property?
Long-term renters and college students have slightly different considerations when it comes to a rental property. They choose price and closeness to college over luxurious amenities and size. When the alternative is dorm living, which can cost the same (or even more) as off-campus accommodation, what most students want is a good, no-frills place to relax and do their study.
Students are aware that upgrades can raise the price, so landlords can avoid spending money on pricey restorations and modern updates. They don't care if the backsplash is granite or if the appliances are modern. All they need is a working home that satisfies the implied warranty of habitability's standards. That is, functional gas, heating, electric, and plumbing systems; functional sinks, toilets, and showers; non-leaking roofs and walls; and freedom from health concerns and vermin, among other things.
Also Read: Things Landlords Should Know about Rental Property Tax Deductions
Pros of Renting to College Students
Although college students have a negative reputation, there are numerous advantages to renting to them.
High Demand for Rentals
There will be a market for the unit as long as the school continues to accept students. Because most schools do not provide housing for 4 years, thousands of students will be on the lookout for a place to live. Furthermore, because this need occurs every year, one won't have to worry about open positions.
Higher Rents
Because students are looking for ways to cut costs, many opt to live with roommates and split the rent. When multiple tenants pay rent on a single lease, however, one can raise the price while keeping it cost-effective. For example, one might rent the three-bedroom apartment to a family for $2,000 per month. But, one might be able to charge students $2,250 per month, which comes out to a more affordable $750 per person and more money for oneself.
Cons of Renting to College Students
While there are many advantages to renting to students, they aren't always the most mature or responsible group. If someone is thinking about renting to students, here are some things to keep in mind.
No History
When renting to college students, this could be the most dangerous risk. Because they're young and generally have no prior renting or debt-paying history. So, vetting them may be more difficult. One is unlikely to obtain the information they need to evaluate whether they'd make good renters, cause minimal problems, pay rent on time, or meet any other typical screening criteria.
Inexperience with maintenance services
These are almost certainly first-time renters. That suggests they're probably untrained in basic property maintenance. One may risk obtaining rodents or other pest infestations if they're sloppy. They may also fail to report minor maintenance issues that can lead to larger issues, such as a roof leak or a malfunctioning stove.
Should You Rent to College Students?
Even though renting to college students has its drawbacks, due to the large and persistent demand for accommodation near campus, it can be a reasonably predictable and successful source of passive income. Regardless, one must thoroughly vet all possible tenants and cosigners to ensure that they will be reputable and trustworthy renters.
