Ask the Expert: Becoming a Landlord in a College Town
The school year is winding down, and before you know it college students across the county will be looking for a place to live in the next year. Having a quality rental property in a college town can be a big money maker, but is it worth the hassle? We asked Steve Taylor from Wolfe and Taylor for the rundown for our latest Ask the Expert post. Wolfe and Taylor's property management division acts on behalf of many homeowners renting to University of South Carolina, Benedict College, Columbia College, Allen University, and other area students.
Do you need to offer flexible leases?
We only offer one year leases, because it cuts down on turnover costs for the owner. However, some landlords do offer flexible lease terms with expirations in May through June to allow for better turnover leasing in student rentals.
Are there any "must haves" when renting to college students?
There are no "must have" amenities. However new multifamily properties with nice amenities will cause smaller properties (duplexes, single family, etc) to adjust rental rates with the market. That said central heat and air (especially here in South Carolina, where a lot of students from cooler climates aren't used to the heat and humidity) and washer /dryers are important.
Does renting to college students affect your insurance premiums?
Insurance companies do not typically increase premiums for a rental property. However, we view it as very important for owners to notify insurance carriers they are renting so they can review coverage. It is our experience that some insurance carriers think favorably when a property is managed by a professional property manager.
What's the most surprising thing about renting to college students?
Dealing with the parents of students has given us the most surprises. Also, many students lack of knowledge for basic maintenance needs, like how to flip a breaker. [Ed. Note to Self: Must teach kids the basics, so they don't make me look like a slack parent when they rent their own apartments!]
What should you look for when buying an investment property in a college town?
Location and condition for re-sale are very important when looking at investment property. However sophisticated investors will apply "return on Investment" and other investment formulas to a purchase. We like to think hiring a property manager can help you make money from your investment, because we're able to market your property and make sure it's kept in good condition.
Is the turnover higher for college rentals?
College rental turnover is equal or less than conventional lease turnover rates. College rental renewals are higher than conventional leases.
When should a property owner start the lease renewal process?
Start the renewal process at least 3 months prior to lease expirations. Try to have lease terms come up at the end of May through the end of June.
Steve Taylor, CPM and partner and Broker-in-Charge of Wolfe and Taylor, has a wealth of experience in construction management, association management, apartment management and real estate sales. He is the past president of the Columbia Apartment Association, a member of the Institute of Real Estate Management (IREM), Central Carolina Association of Realtors (CCAR), Consolidated Multiple Listing Service (CMLS), and Community Associations Institute (CAI).