Renting to students is one of the ways to make money as a landlord, especially if your property is located in the vicinity of campus. Before you consider this tenant base, however, you need to learn the pros and cons and other information about this type of tenant.
Profile of a Student Renter
Description: A student is an individual who is enrolled in a college or university. They could be taking undergraduate classes or may be enrolled in a master’s program.
Age: An undergraduate student renter is commonly between the ages of 17 and 24. The age range for those enrolled in master’s programs is much more varied. A 90-year-old person could be enrolled in a master’s program if they so choose.
Income: Many undergraduate students go to school as their full-time job and might be making a supplemental income from part-time work or work-study programs.
Marital Status: The majority of undergraduate students are single, unmarried individuals.
10 Things Students Look for in a Rental
1. Proximity to Campus: The number one thing a student renter is looking for when choosing a place to live for the school year is how close the rental is to the campus.
2. Affordability: Another high priority on a student’s list is how much the rental costs. Money may be tight, and while they need a place to live, they also want money to eat and to go out with their friends. They may prefer a moderately priced rental to a more expensive, renovated apartment. Living with roommates and splitting the monthly rent can also help keep costs down.
3. Proximity to Amenities: Being close to town is another high priority item on a student’s wish list. Quick access to entertainment, shopping, and dining are all desirable in a rental.
4. Access to Public Transportation: Many students do not have cars, so access to public transportation is a must. This can include trains, buses, and taxis.
5. Safety: University students, as well as their parents, want to know that they are safe at home. Low crime areas are the most desirable. Well-lit apartment exteriors are a plus. Deadbolts on doors and working locks on windows are necessities.
6. Private Area: Even if a student is living with roommates, he or she wants their own private space. This can be accomplished by having multiple private bedrooms and a common area, such as a living room and kitchen, which the roommates can share.
7. Neighbors: Students may have a desire to rent an apartment in a certain neighborhood. Some students want to live in an area with homes predominately rented to other college students. Other students want the exact opposite and want to live in a quiet residential neighborhood, removed from other students.
8. Updates: If a rental unit has updates, such as stainless steel appliances or a newly tiled bathroom, and it is in the student’s budget, he or she will likely choose that rental over a similarly priced rental that is not updated. For most students, updates are a bonus and not a requirement.
9. Cleanliness: Most students would prefer to live in a rental property that is clean and free from rodents and other pests.
8 Well-Known Campus Towns
Many towns across Kenya are home to a large number of students. Life in these towns is often centered around the college or university:
- Juja, JKUAT
- Kahawa, Kenyatta University
- Rongai, MMU, CUEA, African Nazarene
- Ruiru, ZETECH
- Njoro, Egerton University
- Eldoret, Moi University
- Athi River, Daystar University
- Ngara, University of Nairobi
Important Things to Consider When Renting to Students
Quiet Hours Policy: Student renters are notorious for being noisy. You must include a Quiet Hours Policy as part of your lease agreement so that the tenants know there are certain times when they can have their fun, and there are other times when they need to be more respectful of others.
Security Deposit Requirements: Student renters are also notorious for causing damage. Before the tenants move into the rental, you must make sure you collect a security deposit in addition to the first month’s rent, so that you can use this deposit to pay for any damage that may occur. The maximum amount of deposit you can collect will depend on your state’s laws.
Here’s a snapshot of the pros and cons of renting to students to help you decide if these tenants would work for you and your rental property.
Pros
- High demand for rentals with new renter candidates each year.
- Potentially higher rents because of strong demand and multiple renters per unit paying higher total rent.
- Rental payment security because parents often make the payments, and might pay for a full semester up front.
- Easily filled vacancies due to word of mouth.
- Students may tolerate less well-appointed units and complain less because they’ve never lived in their own place before.
Cons
- Possible property damage and pest infestations from careless student tenants.
- Evicting students for non-payment of rent may leave unit unrented until the next school year starts.
- May have to contend with renter turnover every year.
- Competition from high supply of other rental properties may require lower rents to attract renters.
- Harder to screen student renters because they lack any rental or work history.
- Students may disregard lease terms such as noise constraints, frequent visitors. and too many occupants living in the unit.
5 Pros of Renting to Students
Certain benefits come with renting to college students.
1. High Demand: Many universities and colleges do not offer students four years of housing. Therefore, these students need to find off-campus housing to live in during the years when they cannot live on campus.
Each new school year, you will have a whole new set of students looking for a place to call home.
2. Higher Rents: When you are renting to students, you may be able to command a higher rent. This is for two reasons.
First, students often live with roommates, rather than alone. Since the students are splitting the rent payment, you may be able to get a few hundred shillings extra from them than you would if you were renting to the general population.
The second reason you may be able to get more money is that there is a constant demand for housing. Students who attend the college and do not have on-campus housing will be looking for a place to live. When the demand for anything is high, you can charge more money for it.
3. Third Party Payment: It is very common for a student attending college to have their rent paid by someone else. Often, a student’s parents are the ones who are paying the rent, and they will serve as co-signers on the lease. Other students will have their living expenses paid as part of their financial aid package.
In either of these situations, it is very likely that you will receive your rent each month. It is not uncommon for parents to even pay a full semester’s rent in advance.
4. Word of Mouth Fills Vacancies: Students may view certain rental properties as very desirable. These can be properties that are close to campus, that are close to amenities, that are known as party houses or for any number of other reasons.
If you have a property that students want, they may be knocking at your door before your current tenants even move out. For rentals like this, you will have to worry very little about vacancies and will not have to spend much time looking for tenants.
5. Satisfied With Less: Most college students are not looking for the most high-end finishes. They are looking for a safe, affordable place to live. They may even complain less than other tenants as they are more focused on school and their social lives than on examining every square inch of their apartment. They may not notice a drafty window or complain that the kitchen only has two feet of counter space.
7 Cons of Renting to Students
While there are many benefits of renting to students, there are also several negatives to be aware of. College students may not be the most mature renters. Damage and noise complaints are common issues.
1. Inexperience Maintaining Property: Students are young. For most, this is the first time they are living on their own. Their inexperience maintaining property could cost you as a property owner.
If the students are dirty, you may begin to have problems with rodents or other pests. If they do not report small maintenance issues, such as a small roof leak, these minor issues can turn into big problems if not fixed right away. Their negligence could also cause damage at the property which you will need to repair.
2. Inexperience With Money Management: Again, for the majority of students, this is the first time they are living on their own. Money may be tight and sticking to a budget can be challenging. A night out with friends may seem like a better way to spend their money than on their monthly rent.
You could be forced to evict a student tenant midyear for nonpayment. It can be more difficult to fill this vacancy as the majority of students have already found their rentals for the year.
3. Frequent Turnover: When renting to students, you may be faced with a yearly turnover. Students usually want short-term rentals that run the length of the school year. You will have to fix any damage to the apartment and find new tenants frequently.
4. Competition: You could face a situation where there are more rentals available than students who are looking for rentals. The students will, therefore, be able to be more selective about where they live. In this situation, you may have to lower your rent to entice students to live in your property.
5. No Rental or Employment History: Screening students can be more difficult than screening other tenants because they are so young that they likely have a minimal employment history and rental history. It is common to have a parent co-sign a student’s lease, so if the student stops paying their rent, the parent will be responsible for making the rent payment.
6. Breaching the Lease: Students tend to disregard many of the clauses on the lease agreement they have signed. Student renters tend to be noisy. They may use their apartment to throw parties or may play their music loudly on a regular basis.
To cut costs, there may also be more people living in the apartment than those listed on the lease agreement. Frequent visitors can also increase the wear and tear on the property.
7. Summer Vacancies: Since many students go home during the summer months, it can be hard to fill vacancies when school is not in session. One way to counteract this is by having a student sign a lease for a full year, even if they will not be living in the area for the summer.