All Forum Posts by: Pierre Streat

 Students are not a protected class, so there is no worries about discrimination.  You will probably market the units similarly to how you would for students, making sure they have features that longer term grad students look for in your area.  You can try and talk to the student housing at the college and ask about positing there.  The thing is, when students call, tell them they need to have verifiable income or grants to cover the rent.  Its highly unlikely that undergrads will have enough income or scholarships to cover the rent plus extra expenses.  Plus, alot of grad students live alone, so you wont have to worry about multiple lease agreements with multiple tenants. 

Temple is over saturated for sure, but mostly in the 4 bedroom/2 bathr0om market. Smaller units are still the rage and fill easily.

I live in NH, and my property managers are in Chicago and Danville (where our properties are), both do great jobs. We use skype and pictures for repairs....in this way, I have records of the changes.  

I would wait to see what the roofer says--this could be a deal breaker.  

Good luck, and thanks for sharing

Consider the school year,  Sept thru May/June.  High vacancy would be June, July, Aug; I see that as 3/12 or 20% vacancy, unless you get some grad students or faculty.

@Pierre Streat  The Temple area is over saturated. You should look around University of Penn, Drexel, or La Salle

@Pierre Streat I agree with what others are saying here. Those are very low returns, especially for MF. I don't think that a 5% vacancy is "conservative" by any means. I think this is way to optimistic for MF, especially for student housing.  I'm not an expert on the Philly market but I would think you could do much better than that there.  

But since you're already investing out of state by going to Philly, why not go somewhere where you can find much better returns like the Midwest? Personally, I like Indianapolis and Kansas City.

@Pierre Streat perhaps you can reposition the property to appeal to grad students instead of undergrads.  This would address the turnover issue since a one-year lease is the norm (for my rentals anyway) for this type of tenant.  I've even had grad students ask for a two-year lease to "lock-in" their housing costs. 

Beyond the numbers, you need to serious consider whether you can handle being a landlord to undergrad students.  I do not have direct experience with them, but we have all heard the horror stories.  I understand you intend to use a PM but even the best PM is going to have a hard time with this group... I'm envisioning loud parties, routine drug selling and consumption, roommate issues, etc.  I don't think I would be comfortable renting to undergrads unless there was a full-time resident manager on the premises... too much risk for too little return.

where is the property? @Pierre Streat

 If I read the figures correctly you would be netting about $300/month? $3,600/year? And it will cost you $84,000 out of pocket to purchase? That's roughly 4.3% return on your money and you confirm as being 4.26%.

Myself personally, I wouldn't touch it. There are much better deals out there IMHO. Hope that helps.