Rental in college campus area

[Peter J]

What has been your experience with renting to college students in a highly student dominated area?

I found a property that actually meets the 50% rule but it needs about $50k in repairs first. Listed at $35k + $50k repaits = $85k but gross rents are $2100.

Let me know if there is significantly more risk in renting to college students because of the turnover and possible damage.

[Peter J]

I'm keeping the faith someone will help with this question. As always, I'm very appreciative of everyone's advice since you provide it free.
Thanks.

[Nick Johnson]

I have often thought of this approach as well.

I am very interterested in the replies you get as well.

GL Peter J

[Keith Guntert]

My first question is what kind of damage to a house can cost 50k? I have been rehabbing for years and I have yet to spend 30k much less 50. I would love to go over that with you!

Renting to students is another matter. There are different kinds of students, ones that have parents that pay for everything and ones that work. There are also different academic students, for example those that are engineering or science majors usually are not the partying kiind. Those in liberal arts tend to be more social. My suggestion would be to rent to students who are responsible and working.

Sometimes you may have several students wanting to share a house. You need to be flexible with individuals as one person moves out and a replacement comes in. I have rented by the room and charged a flat rental fee, which is another way to increase your rents per month. Demand a good deposit and make a lease with specific rules pertainig to conduct and parties.

[Mark N.A]

I like renting to students, but then I've been doing it for a good while.

However, they are very similar to my low-income tenants. They'll whine, make excuses, ignore lease rules, cause damage, and be irresponsible in many other ways.

They're immature and naive and often you will take on the role of parent/educator/rule enforcer.

Get the parents to sign personal guarantees. Involve the parents. Make the parents and student tenants understand that they are 'jointly and severally' responsible for the rental. That means if Little Johnny does damage that exceeds his share of the security deposit, then the rest comes out of Big Eddie's share and if that gets used up then all the parents are next in line.

Make sure your lease has a 'legal action' clause wherein you will get your legal fees back if you are forced to go to court and you prevail (don't make it that way if they prevail). Most of these parents have dough, and many have LL experience, so they'll know lawyers.

Know your municipal codes and neighborhood associations. Landlords are increasingly becoming targets of choice by irate homeowners and petty city bureaucrats. Don't get on their radar.

Today's students are spoiled and feel extremely entitled. Your competition is the complexes that offer all the bells and whistles that you cannot. An extremely excellent location is your best ally.

Lastly, understand that you are TOTALLY dependant on your college. Just like companies they can and are going out of business in this bad economy.

Good luck.

[Mikey Kay]

I have been in student housing for a while and love it. Where I am, the university does not have enough housing! The demand is def there for renters. In a bad market you are always going to have tenants. The only down side is (late payments, kids that are obnoxious ect.)

I have learned not to have the parents on the lease because then the parents tend to call you and complain. If the parents are not on it then the kids have to call and I do not have to speak to the parents who are sometimes (lawyers who like to threaten legal action EVERY TIME).

IF the deal makes sense thats great, also go to the college and see how strong it is . Do they offer housing? What are rents in the area? How are they doing financially? Do they have a masters program? state school? do your due diligence before hand.

good luck and let me know if you need anymore help