Landlording Strategy: Student Housing
Hello BP!
I recently met an individual who has a few rental properties in his portfolio. The thing is, he is only marketing them as "student housing". The properties are located near a local college and he has worked with them to get on their preferred housing list.
A few things:
1) He says he only markets them as student housing and only places ad's in places where students visit / would see (like college sporting event programs). I guess he's able to get around the "fair housing" laws because he's marketing them as student housing so he doesn't get regular Joe's inquiring about them.
2) His leases are per college semester and he has parents co-sign and puts them as the primary
3) He doesn't do any background checks. He didn't really explain why not but I'm assuming it's because he probably figures that the parents are going to pay anyways. They aren't going to not pay and have their child be kicked out.
4) He collects a small deposit and security deposit at the time of lease signing and then the remainder of the rent for the semester by the end of the 1st week they move in. So payment is up front, just like you would pay for housing on campus.
5) The properties he has are a "per room" lease. Meaning, the propertty has 6 or so bedrooms but then everyone shares bathrooms and kitchen. I'm not really sure if that's even legal to do....?
He says it's great because he never has to worry about finding vacencies and it gives him time during the summer to do renovations since most of the units would be vacent, but his expenses are still covered for the year because he takes the "summer" months into account when determining the rent. I'm assuming the paperwork is a little more, but he says it's not too bad.
What are your thoughts on this? Does anyone else do this? What can you think of for pros vs cons?