The thought of renting residential property to students probably does not leave a very good taste in the mouths of most people. Why would you buy a property only to have it ruined by immature, boozed up young adults? Judging from some of the stories you hear or may even remember yourself from your student days, you may be right. The fact remains though, students need somewhere to live and for the discerning buyer, this can prove to be an attractive investment opportunity. Here are 4 positive and negative attributes of student housing.
The Pros:
1) Students are happy to live in dwellings that may not necessarily have the most up to date fittings. Meaning you can spend less on the investment and maintenance costs are reduced, as the expectation on new fittings is not there.
2) Students typically live in groups meaning the rental return is usually strong. Students expect to be charged market rates for lesser quality housing as they realise they are a risky investment.
3) Long term contracts. Students are usually prepared to sign up for a fixed tenancy period as part of the tenancy conditions. This guarantees your rent for a set period of time.
4) Added benefits. You may be able to charge students extra for services like lawn mowing or cleaning. Provided you have the time and energy to do this, it can be a good way to keep an eye on the property.
The Cons:
1)Students will have parties and chattels like carpet will suffer accordingly. Whilst replacing fixtures more regularly is not an appetising thought, some consolation can be taken from the fact you can replace it with cheaper quality products.
2)Upkeep and maintenance around the investment will suffer. Students often shy away from doing anything other than the bare minimum. This means lawns will not be mowed, gardens will not be weeded, windows will not be cleaned and showers will probably grow some sort of fungus!
3)Paying rent may not be the top of the priority list for students. Falling behind in rent and chasing students up for payments may be a common occurrence
4)The value of your home may not appreciate in value in line with other homes due to the stigma attached to student housing
Whilst this list is by no means a certainty and the issues do not necessarily apply to students alone, it is a brief warning on some of the things you may encounter.