How bad can it be-after all they are only collage kids.

Question

I am thinking about renting my duplex out per room.  The duplex is near Weber State (Utah) and I think I can get $350 - $400 per room.  So a total of 6 rooms as per zoning.  The cash flow sounds great but I am a little worried about what will happen to the place with 6 college kids.  I am thinking I will do "LDS standards" which means no drinking, smoking, ect.  But I am still a little worried about the headache I am getting myself into.  What has been your experience renting by the room to collage kids?

Account Closed · Answer

If you had the option to rent to law students or med students, you wouldn't have the types of problems you can get with undergrads.  And not all grad students are alike.  I learned that MBA students usually stayed short-term, and art or music students no matter their age are usually still into partying LOL.

We found a niche with law students, and rented mainly tiny studios.  They are quiet and study all the time and are responsible.  They just want a quiet place to study.  If all of your students were that type of student (and I agree about international students being this way, too), they'd get along better.

Our law student tenants usually stayed several years and were no problem.  We did M2M agreements only and I allowed them to sublet their units over the summer - what I did was give them written permission to have a long-term guest, and told them I don't care if money changes hands, but the original tenant remains my tenant and is responsible to pay me.  Worked out great.  They often have summer internships somewhere else but don't want to lose their unit.  And they find someone - usually another law student - who needs to move out of student housing for the summer, or who is a student who came to this university for a summer internship.  My tenants often made a profit on their sublets LOL.  I had one ask me if it was okay for him to charge more rent to the sublet than he was paying me.  I said go for it!

If I rented by the room, and didn't have a den mother, I'd just include a regular cleaning service.  We also had utilities included, just because it was an old converted building and it would have been too expensive or too much of a hassle to convert to metered units.  I think including the utilities would be a good idea in your situation, too, just to eliminate another item that can cause arguments between tenants.

Good luck!

Tyler Ansell · Answer

One of the big things to remember when dealing with the students is that for most, it's their first or second step away from living with parents. They probably went Parents -> Dorm -> Your Place. That said, they will likely forget trash pick up is on Monday and Thursday and forget to put their cans out. They'll also expect things to be handled quickly when it comes to service calls, IMO they don't have the same understanding that things can take some time to repair. Parts ordered don't appear next day like Amazon. Little differences like that.

Jacob Cogswell · Answer

I rent to students in Provo. I've never had a problem with them. Do all of your normal background check work. Credit, background, and gut check. If they don't pass those then you don't rent to them. The nice thing you can do with students is to put them on their own contracts so that you can increase your cash flow, and if one moves out then you find a new person to put in there. Then you are not out an entire unit. Some people tend to rent different amounts for the time of year. Lower rate for the summer. I have my tenants sign a year lease, so it is rented out all year.

Roy N. · Answer

Fortunately, they are still typically young enough to be trained.

Tyler Ansell · Answer

@Roy N.

Agreed! Must start off immediately with how you want them to behave as tenants for you, you can really set yourself up to have a great experience if you start off strong

Dax Gurr · Answer

Thanks everyone,  That is great advise. from what I am hearing, the biggest difference between collage kids and everyone else is they require more time and energy.  I think that makes sense.

Calvin Chow · Answer

College kids can be slobs, and they do stupid stuff.

The good news is that unlike other tenant groups that are dirty and tend to do stupid stuff, college students aren't hostile, just careless. The key to dealing with college students is to understand they require active management. Check the property regularly (every other month, sometimes), have cleaning fees, and be upfront about these fees you will charge.

I find the best approach is to inspect, inform them of any deficiencies, and give them a set period of time (usually discussed heavily during signing) to remedy it that will avoid the fee.

William Hochstedler · Answer

I haven't listened to this, but you might want to check it out:

https://www.biggerpockets.com/renewsblog/2015/09/1...

Student housing is a different animal.  Often these are kids who are living away from home for the first time.  The cash flow can be much better than straight annual rentals, but the management is more intensive.  Also, summer vacancies can be an issue.  It guarantees frequent turnovers.  Policies and rules are a must.

Depending on zoning, you may also be able to rent rooms as doubles and increase cash flow even more.

Roy N. · Answer

@Dax Gurr

It's a regular part of our business - approximately 60% of our current portfolio.  Renting to students need not be a frat house disaster and can be very profitable.

We have two houses where we rent-by-the-room at the moment - here the going rate is $450 - $475 per room depending upon how close your are to campus and what is included in your rent.  viz. we are two blocks from campus and include basic utilities (heat, lights, water) and Internet.

Most of our roomers are international students who are less problematic overall, but we still find things flow more smoothly with a "Den Mother" (my sister-in-law) living in the property.  The Den Mother ensures everyone is respectful to one another, that the common areas are cleaned, garbage goes out, etc.

We have every tenant read and sign a copy of our house rules as part of their lease and we let rooms on a month-2-month basis, which allows us to deal with any problem tenants in 59 days or less. {Note: We have only ever asked 2 tenants to leave in five years of operating that house.}

If you search the forums here on BP for Student Housing and/or rooming houses, you will find several threads discussing aspects of the topic in more depth.