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List Of Pros And Cons Of Renting Property In College Towns
While renting to students can be profitable, it can also be stressful for property management. Whether in a quiet rural area, or in a busy metropolis, college towns will have, of course, college students, because many of them prefer living off-campus during their years in college.
Although this can be beneficial for landlords, it can also come with several risks. With that said, let’s go over the pros and cons of renting property to college students during their college career.
The Pros?
“Properties near colleges and universities can definitely profit off of students who choose to live off-campus,” says Alannah Blundell, a real estate blogger at Eliteassignmenthelp and Essayroo. “Since most students are looking for practicality rather than style, units near schools will be suitable for them, thus filling out applications and, eventually, vacancies.”
Here are the pros of renting to college students:
- Units Already Sell Themselves
In most cases, college towns have various activities to do, as well as popular places to check out (ex. restaurants, shops, nightlife, etc.). And since many of these activities and places are geared towards young people, they’re a good draw for rental units and apartments available.
Plus, college students look at how safe a town is. If the town has police officers, campus security, etc., then they’ll want to stay.
- Many Applicants
With college property consistently in high demand every year, there’s always new students (undergrads and postgrads) looking for living arrangements, thus creating a pool of applicants for every local property manager. So, with more students opting for off-campus living, mainly to get a taste of being on their own, that can be good for landlords.
- Low Market Rental Rates
With a fluctuating economy, students can invest in rental properties near colleges; and the values of housing and rental rates vary, depending on the area. With rentals in high demand, and having a high value, you can charge market rates without driving away applicants or seeming fraudulent.
- Consistently Low Vacancy Rates
Despite turnovers and seasonal breaks, properties in college towns have low vacancy rates. As of 2018, the vacancy rate for student housing in the U.S. was at 2.6%, with the percentage increasing only over the summer months since it’ll drop during the school year.
Also, student tenants might stay during the breaks to continue working, take summer or winter classes, or access university resources. Offseason student tenants can sign full-year leases, if they stay longer, thus letting property managers attract more prospects for people working at the university.
The Cons?
“Leasing a standard apartment and renting units out to students are two different things,” says Yasmin Ingram, a writer at UKWritings and Simple Grad. “Plus, there are risks in renting them out to students, who are considered seasonal residences, depending on their programs.”
With that said, here are the cons involved:
- Tenant Turnovers
The stay of incoming students depends on how long they stay – whether they’re:
- Bound to graduate
- Graduated already
- Staying for the whole 3 or 4 years
- Staying for only 1 or 2 terms
And sometimes, students may end their lease early, which can be problematic when landlords are expecting rental payments. Thus, property managers must advertise the vacancy, prep it for new occupants, screen applicants, and choose the right tenants, which can be time- and money-consuming.
- What About Off-Seasons?
Since universities go on a break between semesters (summer and winter), some businesses may go on break as well, thus not attracting people that you can rent units to. Therefore, it’s pointless for students to pay for when they’re not using the space.
- Risks Of Property Damage
Property damage is one of the largest concerns of most college town renters. Sometimes, the wear-and-tear in a standard unit can turn people away. And sometimes, some students may host wild parties and get-togethers that can potentially cause damages.
- Investment Is Not Static
It’s important to keep your rentals properly maintained and monitored at all times, or else you’ll risk neglecting the property, even when the lease is up. Also, first-time tenants will have questions to ask, and may point out problems (i.e. repairs, broken appliances, etc.).
Conclusion
While many of these are hypothetical situations, they’re still important to think about, when renting out property to students. With a well thought-out and organized leasing agreement, as well as desirable places to go and things to do in the area, you’ll soon attract college students.
Beatrix Potter writes for BigAssignments and Assignment Writing. She also writes and edits for Top assignment writing services in South Australia. As a writer, she writes about various topics in the college scene.
