Rental properties in college-oriented areas or near universities are popular hotspots that can be a smart investment for renters. However, there are many risks associated with renting to university students. It’s important to be aware of these risks and adjust your renting style accordingly. This protects your property and ensures you have a successful renting experience.
What are the risks?
College students are inexperienced tenants. They are often new to renting property and are prone to make mistakes or not be aware of proper renting etiquette. This means you should make the renting process as simple and clear as possible.
College students can be careless. Students often will not live in the same property for more than a year or two, and therefore they tend to be less cautious with how they treat the property. Many students also may not be aware of structural or long-term issues that should be reported. This can lead to more damage or required maintenance on the property when they move out.
College students often have low budgets or rely on weekly income. Many university students live on a very low income since they are taking classes full time. They are less likely to have savings built up for emergencies and may find themselves in a situation where they are unable to pay rent.
How can you minimize the risks?
In order to have a smooth and easy renting experience, you will need to tailor your property and renting style to a young audience. Take the following precautions and adjustments to ensure you get the ideal tenant and prevent problems:
Invest in effective marketing and outreach: The best way to get responsible and trustworthy tenants is to advertise your property well. You should not only increase advertising volume, but also market your property in specific outlets that are more likely to reach responsible students, such as university involvement groups or honors programs. Tailor your advertisements to a young audience by creating a simple, clear, and organized list of information. Young people will be drawn to modern and well-designed ads. Include tenant expectations, such as the pet policy, security deposit, and amount required up front. This gives you transparency and reduces calls from unqualified applicants.
Thorough tenant screening: Just as any renter would, require full applicant screening including a background and credit check. Call references to get an idea of the tenant’s character and responsibility level.
Require a co-signer: Many students do not have good credit built up and are at a higher risk of missing rent payments or paying late. Requiring a co-signature from a parent or trusted adult will ensure that rent is consistently paid on time.
Adjust or emphasize lease terms: You may want to adjust the lease terms to accommodate college student tendencies. This can include a higher than average security deposit, as long as it remains within the legal limit. Emphasize terms regarding parties, gatherings, and occupancy limits. Utopia works with clients to construct a lease that fully protects you and your property.
Include utilities in the rent payment: Students who are inexperienced with budgeting or monthly bills will prefer a rent payment with utilities included. This not only makes your property more appealing, but it also reduces issues and hassle throughout the year. Consider including water, electricity, gas, trash, and internet in the monthly rent.
Consider renting by the bedroom: For properties with multiple rooms, consider adopting a “by the bedroom” lease. This allows each student living in the property to be responsible for their own rent. This policy makes students more likely to make consistent rent payments and take care of the property, because every occupant is responsible for their bedroom and shared living spaces. At Utopia management, we discuss the benefits and limitations of bedroom leases with our clients and help them construct a lease policy that works for them.
Clear communication of the lease: It may be a smart idea to include an additional copy of the lease with specialized language that’s easier for college students to understand. Additionally, have the tenants go over the lease in full, either with you or your property management company. This allows tenants to ask questions and confirm their full understanding of the lease terms and regulations. Utopia management offers assistance to clients in both writing a lease and communicating lease terms to tenants.
Regular maintenance checkups and simple tenant communication: It’s always a good idea to require regular maintenance checkups to ensure no major damage on the property is going ignored. Additionally, make sure your tenants are comfortable contacting property management for maintenance requests. Always keep communication open, flowing, and welcome so you can stay informed about the state of your property.
Utilize online systems: College students are tech savvy and will always prefer an online method for paying rent, requesting maintenance, and communicating with property management. Find a user-friendly online system to ensure timely rent payments and open communication with your tenants.
By following these tips, you can effectively rent to university students or young adults with limited hassle and peace of mind.
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