How to Rent to College Students
Whether you’ve owned your college town property for years or you’re just getting started as a landlord, you should know that renting to college students isn't the same as renting to working adults. That’s why we’ve put together a list of tips for giving your renters the best possible experience while maintaining your property’s value — and your sanity — at the same time.
The Pros and Cons of Renting to College Students
If you’re thinking about purchasing a rental property near a college campus, you likely already understand the financial rewards that come with it — especially if you were once a college student yourself. But first, take a look at the benefits and drawbacks of renting a property near a college campus before you buy an apartment, condo or home:
College students are always looking for places to rent. College students want to stretch their wings and enjoy their new-found freedom as soon as possible. Whether they’re fresh out of a dormitory, are new to campus or in the final stages of their college career, you should always have plenty of interest in your property.
You can earn a healthy, regular profit. As college room and board steadily increases, you can offer students a better rate and still get a solid return on your investment as a landlord. Don’t raise your prices just to boost your bottom line, though — predatory rental practices are unethical (and sometimes illegal) and can harm your reputation and future rental prospects.
Parents are often involved. If you’re worried about getting paid on time, you can take some solace in knowing that parents will sometimes pay their child’s housing costs. Proper screening techniques can help you make sure your tenants will be able to pay their rent and utilities responsibly. And even if their parents don’t pay their rent, having a parent co-sign could allow you to recoup your losses if the student doesn’t pay.
College students don’t need fancy spaces. Most of the time, a very basic space with room for temporary customization is all a college student will want in a place. Your property doesn’t need to be fully furnished, nor does it need a state-of-the-art kitchen. Plenty of college students move after one year in a rental property, so they’ll often focus on the price and basic amenities rather than luxuries.
The amenities that appeal to regular adult tenants might not draw in college-aged renters. Put more emphasis on things like laundry machines, high-speed Wi-Fi and proximity to grocery stores, campus and restaurants. When you’re listing your rental, focus on those things and less on other stuff a student might not care about, like a fully-furnished living room, new lighting fixtures or recently-replaced windows.
Students can be more reckless than adult renters. College students are known for throwing more parties, being less diligent about their living space’s cleanliness and causing both minor and major damage to rental property. That’s why collecting a deposit and having strict rules about fees and repairs is so important — make sure your lease is geared to help you offset any extra costs that might come with renting in a college town.
There’s lots of turnover. When you rent to a working adult, you might be giving them a place they’ll call home for as long as a decade (or even longer!). But with college students, they could move after a year for many reasons: transferring schools, graduating or simply moving to a place that better fits their needs. Prepare yourself for high turnover by utilizing advertising sites, social media and word of mouth to get new renters in as soon as possible.
Finding the Right Tenants to Rent Your Property
Building a good relationship with your tenants is one thing, but finding the right kind of tenants who will pay rent on time, respect the property and be a good neighbor is another. Here’s how you can save yourself a bad-renter headache before it ever begins:
Screen all tenants and parents, if necessary. One downfall of screening potential renters who are college students is that they probably don’t have an extensive employment or credit history, making it hard to judge if they’ll be good about paying their rent. However, you can also screen their parents to see if they have responsible financial habits. Oftentimes, parents will pay for their kids’ rent anyways, making this step a necessity.
Your screening process should include a criminal history and reference check, as well. If you see a red flag, ask the tenant about it and let them know your concerns.
Market and advertise your property appropriately. In college towns, there’s usually no shortage of students looking for rental property. But to get the right kind of applicants for your place, you can post ads on local online classifieds, in local and student newspapers and on social media. Here’s how you can write a great rental listing to get your inbox full of applications as soon as possible.
If you’ve been in the rental property game for a while now, you might not need to do much marketing. In college towns, word of mouth advertising can be many times more fruitful for renters. So when one renter moves out, don’t be afraid to ask if they know anyone who might be interested in renting their old place.
Carefully craft your lease agreements. College students rent differently than a typical adult renter. They’ll need different dates of occupancy, more rules about subleasing and different standards for roommates. If you’re able, enlist the help of a lawyer to help you mitigate your risks with a lease tailored to college students. Make sure to keep your occupancy dates within range of the local colleges’ school years and have firm eviction, late payment and damage rules.
Managing a Rental Property for College Students
Once you’ve signed a lease and have students living in your property, use these tips to make their living experience and your landlording positive:
Consider having renters pay utilities. While including utility costs in the rent and paying them yourself can be a marketable benefit for your property, it can leave you vulnerable to outrageous utility bills from careless use of air conditioning and heating from your tenants.
Be proactive about renewing leases. With the high turnover that comes with renting near a college campus, you’ll need to be proactive about renewing leases to avoid any sort of vacancy. Local laws may dictate how early you can set your renewal deadline, but the earlier you make it, the sooner you can post the apartment for rent if your current tenant plans on moving out.
Prepare for subleasing. Have strict screening standards set for subleasers, too. Things happen and college students may move mid-semester but try to recoup some of their rent by having someone else live in their rented property. All tenants, no matter if they’re subleasers or on the original lease, should go through a screening process that puts your mind at ease.
Consider hiring a property manager. If you have a number of rental properties in your portfolio, consider hiring a professional and experienced property manager to reduce your stress as a property owner.
Talk to a lawyer. Making your leases rock-solid legally is a must, and complying with fair housing laws is your duty as a landlord and property owner. Get in touch with a lawyer well-versed in lease and property management to prevent legal stressors down the line.
When you’re renting out a property, it’s important that you and your tenants are protected from the unexpected. Consider requiring your tenants to have renters insurance, then ask your American Family Insurance agent about protecting your property and yourself with landlord insurance.