Currently a college student and planning on acquiring first multifamily investment in 2015 with a business partner in Rhode Island. Niche model would be student housing since we some of the top colleges in RI from Brown University, Rhode Island college and Providence College and many other ones not listed.
1. Whats the best link on bigger pockets on student housing and the mechanic of that niche?.
2. Legally how do I protect myself as much as possible, I know sometimes as a student some student party or damage or crime or etc happens at the property.
3. What solutions or things you have learned in student housing to investing you wish you knew?
Best way to protect yourself & your property.
1. Get a high liability limit on your insurance policy.
2. Tenant proof your rental. Remove things that break or will need frequent replacement. (Carpet, ceiling fans, dishwashers,garbage disposals, towel racks)
Thank you James.
I didn't know that dishwasher is not going to last long. Was thinking to install one in student housing to cut on the water usage.
I own one student rental in a nearby college town. It's been a great experience so far, but I've had the benefit of being fresh out of college and being able to place tenants myself.
Some quick things to expect:
-High turnover - it will be unlikely for any tenant group to stay more than a year or two. Most students stay on campus their first one or two years, and afterwards many will make impulse decisions regarding their living arrangements. It's not too difficult for a college student to move (i.e. limited amount of possessions)
-To counter what @James Wise posted above, many students will have the expectation that you'll be providing the appliances - dishwasher, fridge, oven, and possibly washer/dryer
-Some landlords find it easier to rent by the room, others do one master lease. Make sure you make it very clear everyone is joint and severally liable for any damages.
-It's a good idea to get the parents to cosign, especially if your security deposit is minimal
-From my experience, students like to have carpet in the bedrooms. If the carpet needs to be replaced in the living room or other common areas, I'd recommend a very durable, moisture resistant flooring. Beer does terrible things to carpet.
-If you allow pets, make sure you have a sizeable pet deposit, if not fee. You can justify the fee by noting that the funds will be used to clean the apartment in a manner that will allow anyone with pet allergies to move in without issue.
-If you use PM, budget at least one-month's rent for tenant placement. 50% for the services of the PM, and 50% for any incentives they use to get the unit rented.
Best of luck!
Great suggestions William.
I noticed as well that in many other student rentals appliances are included. One of the interesting things I found in one property is a coin operated washer/dryer, to make tenants more responsible for utility usage, as most of rentals in that area have room rents with utilities included.
I've seen utilities bills for one of the student housings which had water charge for extra $600. That got me thinking - how to tenant proof the property, not only for physical damage, but for utility negligence as well.
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