Renting apartments to college students sounds like a huge financial risk. But that’s not always true! Here’s the good, bad, and the ugly (maybe).
Renting to college students is a lucrative source of passive income that you shouldn’t pass up!
There are many benefits to renting to college students.
Indeed, they may not stay at your property forever.
Plus, it may require more effort to rent to them.
Yet, assuming you find students who pay their rent on time, they make excellent tenants to have at your complex. And, you can increase your occupancy at the same time.
If you’re considering targeting college students to live at your complex, here are some things to note:
First, what do you think students are looking for in an apartment?
After all, you need to know what appeals to students the most to market to them. There's also a reason they're looking for an off-campus apartment instead of on-campus student housing.
While they’re shopping for a place to live, you’re searching for the ideal student tenants. You want students serious about school and interested in a quiet, safe place to live.
Let's talk about the top four things prospective tenants want in a college rental.
Security is often essential to a student.
So consider adding security features like extra locks to the rental unit's front door. Keeping security cameras in the parking lot can also help all tenants feel much safer in a new town.
Small acts like this give a student’s parents confidence in their safety while away from home. And students like the added peace of mind as well.
If there's a public transportation spot nearby, don't forget to highlight it in your marketing.
For instance, consider setting up designated parking spots for Uber drivers and grocery store drop-offs. Besides being great for students, all tenants can enjoy these convenience features.
Think about offering a small gym for all tenants if you have the space.
Most students make going to the gym part of their routine. That makes having a gym another excellent perk for students who enjoy staying active but want to save money on gym memberships and equipment.
If you set up an all-bills-paid lease for students, you can simplify the entire process. Financial flexibility is appealing for you as a landlord and future student renters.
Speaking of financial flexibility, consider offering rent discounts for the summer months. Offering deals during the summer encourages students to stay in the little college town instead of returning home.
Sometimes, it may be hard to rent an apartment after the spring semester ends. In this case, pulling in rent at a discounted rate is better than not getting any rent payment at all.
Now, you may be curious about how to find students willing to rent out your complex's vacancies. Luckily, there are many ways to advertise to students looking for rental housing near campus.
Here are a few examples:
Students love to hang out on social media, which is why advertising on various social platforms should be at the top of your list.
One idea is to put together a photo spread of one of your units. Then, you can share it on Facebook, Instagram, Twitter, and other social media sites. Besides the photo spread, include a floorplan for the unit to give students a better idea of the layout.
Featuring testimonials on social media is another excellent way to secure student renters. Ask current tenants for testimonials to broadcast how the community feels about living on your property.
From their reviews, you can highlight positive apartment features like:
Remember, even though you’re targeting students, their parents may be the ones paying rent. So you want the people paying the bills to be confident in the living space as well.
You don't need to show off the pricier units with upgrades like granite countertops or whirlpool tubs. Yet, you want to prove that your complex is safe, quiet, and clean for potential tenants.
Besides students, you could also have a new tenant base in a different rental market: part-time or adjunct instructors. If they’re starting at the nearby universities next semester, you may be able to rent to them as well.
You can also use campus bulletin boards to your advantage!
Contact the Admissions and Human Resources on campus for more information about the college’s policies. They can provide instructions on hanging up paper postings on campus bulletin boards.
Do this, and students and new instructors can see the available apartment options for the next school year.
Finally, get current student tenants in on the action through word-of-mouth recommendations.
Add a referral question to your online application. If the new renter includes the name of their student referral, you can reward them with a gift card or discounted rent, for example.
Once the new tenant signs the lease, your referring tenant will experience the excitement of getting their reward!
Students have needs, but so do you as an apartment manager.
Students tend to get their loans and grant funding at the start of the semester. That said, you may want to collect the September to December rent in September. If so, consider offering a pre-payment discount to students.
But make it clear that students aren't out of the woods evictions-wise, though. Even if they pre-paid for rental housing, you won’t tolerate them breaking policies like causing excess noise during quiet hours.
Keep in mind that there are always risks with anyone who rents your units. But the danger is more concerning with students due to a lack of rental history.
The good news is that you can prevent problems like students causing property damage.
Before renting out your units, in-depth tenant screenings should be on the top of your list. Also, consider having co-signers and increasing the security deposit to protect yourself.
Speaking of risks, to have a successful student tenant, it’s up to you to instill the proper rules. That includes creating a solid rental agreement from the get-go.
As a property manager, it's essential to protect your investment, and regulations will help you do that. Furthermore, having a co-signer gives you the extra protection needed if a student stops paying rent on time.
Many college students don't have a credit history or high credit scores. Therefore, getting an established adult to add their name to the lease agreement can lower the financial risk.
Students may also have little to no rental history to their name. Most college students moved away from their homes months after graduating high school.
To keep them from making poor choices as first-time renters, consider:
Keeping units full in the fall and spring semesters requires a skilled leasing agent who can vet prospective tenants. Read the 7 Essential Leasing Agent Duties to Include on Your Job Listing.
If left unchecked, college students can begin to stack up in one apartment.
In general, the federal Department of Housing and Urban Development’s Fair Housing Act has a two people per-bedroom limit. So if you’re renting out a one-bedroom apartment, you can allow two students on the lease.
Accepting too many students can lead to disruption, damage, and property neglect. So try to rent out studios and one-bedrooms to students instead of larger units if possible.
When collecting data, request information about the make and model of their vehicle. If other cars start showing up, that may be an issue, and other students may live rent-free in your units.
Your goal should be to reduce student tenants subletting to other students. That means preventing them from supporting couch-surfing students for an entire semester.
When other students start camping out, it’s a pain to get them to leave!
Now you know about the benefits, how to advertise to students, and local laws. Let’s cover a few more things to keep in mind when renting to them!
As mentioned, most college students don’t have a lot of rental history. They may not have much credit history either.
But even with a lack of rental history, this doesn't have to be a deal-breaker. Although, it should be a sign to you that you need to get a co-signer on board.
It’s better to have a rental property open for a semester than bring in a tenant who can't pay their rent. You also don’t want to deal with any abandoned belongings and damages to the property.
Not having enough rental history doesn’t guarantee you won't get paid.
A student may have another person pay for rent on their behalf. If that’s the case, make sure you market to the parents and the student before moving in.
A few ways to impress them are by showing off the security features and the parking lot cameras.
Some students also have financial aid that helps them pay for rent. Offer them a discount if they choose to pay for the entire semester ahead of time.
Students may not expect to live in a high-end unit. Yet, your units need to be clean and secure.
College students don’t always want stainless steel appliances. They’re more interested in having a refrigerator and a stove. You can also consider offering free Wi-Fi to reduce their other expenses as part of the rent.
Students may well need a place to live from September to May.
Consider offering a bonus if they’re willing to sign a summer or two-year lease. An example of a “reward” would include an assigned parking space closer to the building or a discount on rent.
You need to know if a student has a history of destroying apartments. Monitoring negative credit reports can help you determine this.
But don’t assume bad credit is always a student’s fault, either.
Unfortunately, some students get saddled with poor credit. The reason why could be because their parents used their social security numbers.
That said, ensure that both co-signers and students undergo a criminal background check before agreeing to lease terms.
Having students know your apartment rules is vital. Therefore, make the rules loud and clear. Not only should you outline it in the lease, but you can include a printout of the rules as well.
Communicate that your community prides itself on keeping tenants happy. Also, remind residents that keeping the peace includes everyone being courteous of one another.
If you notice the rules get broken, act on them as soon as possible.
Students being noisy is a common complaint among tenants at a complex. Besides partying, they may create noise in other ways. For example, if you have a no pet policy and hear a dog barking, you need to respond quickly.
You don’t want other tenants to think it’s okay to get a dog themselves if you wait too long to do something about it.
Having students understand the rules will ensure everyone living there remains happy. Besides, a reputation as the party complex is not one you want to build.
If you have a habit of going through each unit during the checkout, that’s great. Yet, having a good record of what kind of shape everything is in is essential at move-out and move-in. So make sure you do a walk-through with the tenant when they move in as well.
When moving them in, you should keep a lookout for:
Note them, address them if needed, and put them in the file. That way, you won’t hold your tenant responsible for the damage they didn't do.
Set an inspection date and time for your tenants. This strategy works in your favor, especially with student tenants.
For instance, you may want to schedule an inspection every three months. Inspecting the unit ensures students manage their household well and aren’t destroying the property.
Before arranging an inspection, though, you should check your state laws for clarity on the process.
During the inspection, keep an eye out for:
If you notice anything awry, notify the primary contact of your concerns. From there, if needed, you can schedule another inspection shortly after.
When moving students in, you’ll also need to establish a primary point of contact. So collect all phone numbers of all the roommates and co-signers.
Ensure that renters know that you’ll be reaching out to their co-signer if you can't reach them. Also, make it clear that you aren't targeting them because of their age.
Yet, you may need to check in with them more often because they have limited credit, rental history, or both.
Lastly, if two or more students are in a unit, you should know the main point of contact. That way, if there’s an emergency, there won’t be any confusion about who to call.
Don’t forget to read our Beginner’s Guide to Running a Successful Apartment Open House.
College renters can be a good source of income. But even though renting to college students is lucrative, be ready to keep an eye on them.
You must have signatures in place and a proper screening process.
Protecting your property, reputation, and existing tenant base should be your top priority. With the proper protections in place, you’ll no doubt have a steady cash flow with a high-demand property full of students who pay rent on time.
You’re bound to maintain reliable student tenants for years to come!
With a 24/7 virtual leasing agent like LeaseLeads on your site, you can find the right student tenants before next semester begins. Schedule a demo today to learn more.
We frequently write about the product and have special articles about pricing. Learn more below.