Will students rent a 3/1

Question

I have found a good deal on a 3/1 foreclosure near Florida State University. It is a foreclose well under market value in need of minimal updates, mostly interior paint. Completed I should still be at least 25% below market value. I am wanting to do a buy and hold rental. My main concern is will students rent a 3 bedroom with only 1 bathroom? There is no half bath. I grew up in a hose with 1 bathroom and 5 people and it definitely wasn't ideal. Will I need to add another bathroom or half bath? I don't think I will follow up on the deal if that is the case. I would be looking for at least $700.00 rent which I believe is reasonable.

Any help is greatly appreciated, this would be my first investment.

Jesse T. · Answer

It looks like typical rooming costs are $6000/year on-campus - which works out to $500/month.  That means your place would likely be affordable for 2 roommates which may be better than 3.  Fewer roommates means things are likely to stay more stable.

I think you are likely better off being affordable for 2 roommates and cheap for 3 than being a stretch for 2 and affordable for 3.

A lot of college students keep such odd hours that it isn't too hard to coordinate sharing a bathroom.  Also if they exercise regularly, they may shower at the gym as much as they do at an off-campus house.

Dawn Brenengen · Answer

@Andrew S. is calling me out on this.  It's going to be all my fault if he can't rent his house because it only has one toilet!  :)  That's ok.  I'll take the blame!

My first apartment in college was a 2/1 that housed three girls.  We didn't mind sharing at all, and I'm an only child who was used to having her own bathroom.  My current house is 3400 sf, with 4 baths, and I couldn't live with less now.

Don't project your own living standards on your tenants.  Just do what the rest of the market is doing.  If there are a ton of 3/1 rentals, and they are flying off the shelves, then stick to it.

Lumi Ispas · Answer

@Johb White , I agree with @Roman Pak . My office is close to UIC in Downtown Chicago and we rent to a lot of students. The number of bedrooms is what they care for, nut really number of bathrooms.

I personally own a building with four three bedrooms, one bath units and two of the units are rented to roommates. Both sets of tenants have been there for 2-3 years and going strong. Clearly the one bath is not a problem for them.

Think as an investor and not as a homeowner. If the deal works, go for it!

Roy N. · Answer

@Jesse T.

I think you are projecting your own living standards too much.

We have 17 (18 once I finish current renovations) student units - two of them are 3/1 houses (which will eventually become 5/2 houses).  As long as you have a good location and offer a clean quality product, you will have no problem renting a 3/1 to students.   If campus housing is $500/mth (does that include meals?), then renting for $400/rm (w/o utilities) or $450/rm (w/ utilities) to three tenants (1200 - 1350/mth) should be very possible.

Johb White · Answer

I never would have figured 3 girls could share 1 bathroom and not have a huge problem with it. I came from a family of 3 boys so I was really going off assumptions. All of your help has been very helpful.

Tom Shepard · Answer

my daughter and 2 friends rent a small 3/1 at their college -- 3 girls one bathroom and they get along fine.  They just signed another years lease, unfortunately right before I found a deal on a 2/1 just down the street.  Fortunately, my next youngest also goes to school there and she and two friends are going to take the 2/1, so not only share a bathroom but also two of them in 1 BR.  Of course they are moving out of a 2/1 dorm situation with 4 girls in it!  I don't think you'll have a problem at all.  Especially near a state school.  Now if you were near some fancy private school, that could be troublesome.

Joey Nakayama · Answer

The last time I listed a 3/1 unit I have in Chicago, multiple sets of student roommates came to see it — and it's not even that close to their campuses. If your place is in good shape and the rent is a good deal compared to other housing options, I'm sure you'll be able to find student tenants.

Economy is king for most college students...If anyone had wanted to kill me while I was in college, all they would've had to do was poison free food ;-)

Andrew S. · Answer

I think that's exactly right - this was MY problem too when I looked at it.  No way I would want to live in a place with only one bathroom, even with only one additional tenant.  Not to drag the thread in the muck, but personally, "when I want to use the bathroom, I WANT to use the bathroom"..... :-)   Not everyone has the same priorities though.

Roman Pak · Answer

I believe knob and tube was phased out in the 40s, so it's highly unlikely.

Johb White · Answer

Thanks for all the help. The 3/1 seems to be a pretty popular layout for rentals.