If you've been strategic enough to purchase an apartment building near a college or university, there's a 99% chance most of your tenants will be students. Affordable dorms are becoming rarer, so students are looking elsewhere to find rooms for the school year. Lucky you!
You'll also know, though, that you might luck out, or you could be in a world of trouble. If you get tenants who do nothing but go to school and study, managing your building for the year will be a piece of cake. On the other hand, you could find yourself with 20 student tenants whose motto is YOLO. They love to party, make noise, and live it up. Sounds like a great time, right?
These last tenants could be a problem if they turn destructive on your units. So, how can you still rent to tenants of this age group while minimizing the potential risk?
Be Smart About Student Renters
They can be a handful, but with these tips, you can screen out the bad ones and do some preventative damage control.
1) Hold prospective tenants accountable: You want student tenants who are mature individuals that will respect you and the unit. In some cases, you may find parents calling on behalf of the potential renter. Besides being a helicopter parent, it shows the student isn't accountable. A reliable and responsible tenant should be able to make that call themselves. If he or she isn't mature enough to pick up the phone and have a conversation with you, how can you rely on them to pay you rent every month? If a parent calls you with inquiries, avoid that renter or ensure that their parents co-sign the application.
2) Be young tenant friendly: If you're renting to college students, your units don't need to have fancy and expensive features. They have different needs and lower expectations. They don't need marble countertops or fancy faucets. The only feature that should be a must-have is wireless connectivity and high-speed internet access. It would also be smart to replace some parts of your units with more durable material like your flooring, or use a semi-gloss paint that cleans easily.
3) Establish ground rules: From the get-go, it's vital to set some ground rules with your young tenants to make sure they know what is and isn't acceptable. Your lease will legally outline what is and isn't allowed on the premise, but they probably aren't reading it word for word. Instead, ensure sure they get a printout version that highlights unacceptable behaviour or they read and initial beside the important places in the lease agreement that relate to proper conduct in the building.
It's good to make sure they have these rules ready at hand, but that's not enough. You'll also need to stick to your guns and enforce them for your sanity and the other tenants. If you have established quiet hours, make sure they're followed. Be clear so confusion can't be used as an excuse for poor behaviour.
4) Screen thoroughly: To prevent any bad apples from occupying your units, screen, screen, screen! You should be doing a background check on everyone that applies, so you can rule out ones who seem too risky and unreliable. Running a credit check and checking their references is a must.
These checks will help you weed out low-quality student tenants. While conducting them, keep a shrewd eye out for any occurrences of court trials involving rental disputes, history of criminal records, or low credit scores. If there are any co-signers accompanying the application, do your due diligence, and run the same checks on them, too.
Apartment buildings located by university and college campuses can be a gold mine for real estate investors. They offer a steady source of tenants, but the quality of them can be questionable. To make sure you don't have trouble on your hands, screen them, hold them accountable, establish ground rules, and college-proof your units.