Hi, I currently have student rental homes and single family homes. I would say that another pro to student rentals is higher cash flow. You can treat every bedroom as a separate unit. For instance, on a 3bd/2ba home you could potentially charge $550 per bedroom ($1650 total) versus a single family occupancy total rent rate of $1200. It is true that you will potentially have a higher turnover rate than single-family occupants; also there is a higher probability of wear and tear with students versus single-family occupants, but none of this is guaranteed. If the school district for elementary and middle schools is not a top school district where your home is located, you're probably going to experience a single-family occupancy turnover every two to three years or so. That's about the average for student rentals. The way to combat your wear and tear is, one, to properly screen your applicants, the other is to charge a premium price. However, in order to charge a premium price your home has to be of premium quality, so I would recommend modernizing the home with decent flooring, appliances, fresh paint, laminate and tile flooring (no carpet), etc. By doing so, you attract 4 year juniors, 5th year seniors and graduate students, kids who are typically more responsible and not only want a nicer place to live, but also will take more interest in maintaining the quality of home.
I say no carpet because even the best students will spill and stain carpets and it lowers the quality of the home when showing new potential residents stained carpet. Carpet cleaning fees can escalate very fast year after year, I say spend the money up front and put in laminate flooring, doesn't have to be expensive, but it looks much better, more durable and last longer than carpet. Also tile in the bathrooms, much better than linoleum, same benefits of laminate over carpet. You basically need to "student proof" the home, any little thing you could potentially see causing a problem or being broken by negligence, try to take preventative measures to replace beforehand. Little things such as assuring that if the water line for the refrigerator sits on the floor behind the refrigerator that a student can't accidentally push the refrigerator against the wall (while horse-playing) and break the water line. I would not recommend any hanging light fixtures, replace all with ceiling mounted light fixtures...the only exceptions are ceiling fans. A good idea is to have ceiling fans in each bedroom also, it cuts down on hvac expenses, and even if you're not paying utilities it helps to retain students when they have low utility expenses in your home. Make sure you have durable bath and kitchen faucets...Ive found 3-hole faucets to be more durable than single-hole faucets. The more you "student-proof" the home, the less wear and tear and maintenance calls you get, and the more "passive" this rental becomes.
I would also add that if the appliances need to be replaced (only if necessary) to replace with stainless steel appliances, trust me, you can find stainless steel appliances from a scratch and dent place for barely $100 more than a white or black appliance and the stainless steel will add much more appeal to your home. If you present a quality product, you will get quality students, and the rent roll will certainly be higher than SFR with potentially the same turnover rate. If you're still in college, I would certainly recommend you house-hack and have your roommates paying down your mortgage for you. That gives your a free place to live, your gaining in appreciation, possibly getting cash flow, getting tax savings, and getting loan pay down...its a great win. Anyway, I hope this helps. Good luck.
