In a college town, chances are you could fill your rental properties with students if you chose to. What are the advantages and disadvantages of leasing to college students? What should you look out for?
Students can be good tenants, or bad tenants—just like the rest of the population. They are also willing to pay top dollar in many cases. If you are clear with college students and let them know your expectations, you can be a successful college student landlord!
Since the new school year is coming up quickly, here are some Dos and Don’ts for considering student tenants:
1. Do make sure you have an iron-clad lease. Have a lease or real estate attorney draw it up for you.
2. Do specify that each individual tenant is responsible for the entire rent. Then, if one moves out, the remaining roommates cannot claim they don’t that person’s share.
3. Do remember that the security deposit won’t cover the potential damage that can be done to your property. Make sure the lease assigns responsibility for damages and losses.
4. Do consider the extra maintenance or repair costs when establishing your rent. Repainting, and replacing carpet and more often, as well as repairing damages, should be considered standard operating procedure.
5. Do specify noise restrictions in the lease. College students like to party, and even small gatherings can become out-of-control in no time at all. Let your prospective student-tenants know that if the police are called to your property due to noise complaints, it is grounds for eviction.
6. Don’t allow “squatters.” If your tenants want to have overnight guests, enforce a 7-day (or however many you deem reasonable) limit.
7. Do specify lease dates: is the lease period for the school year or for a 12-month period? Students might think “one year” means August – May! Be sure the tenant knows the number of months they are responsible for paying rent.
8. Don’t allow anyone who is not on the lease to live in the rental unit. Period. You have no protection against their actions if they have no binding lease agreement with you.
9. Do prescreen all applicants to verify employment history, criminal history, and credit history.
10. Don’t allow the students alone to sign the lease. Require co-signers, such as their parents, and conduct proper credit screening on co-signers, as well—before you offer to lease your property.
11. Don’t hesitate to call the co-signers/parents at the first sign of trouble.
12. Do keep the communication open with your tenants—if they’re late, follow up immediately, from day one, to break bad habits. And, if they’re respectful, clean, and quiet (hey, it could happen!), let them know you appreciate it.
13. Do check your local zoning laws for maximum number of residents allowed in a housing unit—but if you follow suggestion #1, your lawyer will know for sure!