Anyone Experienced With Student Housing?

Question

Natalia Benshaw · Answer

Thank you so much!  I can't tell you how much I appreciate your candid answer.  If it's not too much, would you take a look at my calculator and tell me if my percentages are accurate for my Capital Expenditures and Maintenance?  Keep in mind that the property would be gutted.   I would plan to lease it furnished with utilities included.

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Matthew Perry · Answer

HI @Natalia Benshaw, student housing is both a blessing and a curse. On the one hand you have a new potential tenant pool that naturally turns itself over. Yet, on the other hand the maintenance is going to be crazy because you are right the repairs are higher because students are never easy on the units. I myself have had great success with student housing, but each time I go into it I am always incredibly optimistic and set my expectations relativity low, and use them more or less as anchor for my higher occupancy portfolio. I know what I am going to get each year- nothing more, nothing less. The only part that is off is your vacancy rate, all my student housing is still a twelve month lease expectation with the awareness that come June 1st there are going to be a ton of subletting potential, but I leave all of that to my property management side. That is really the under evaluated side of student housing, which is the real estate agent/property management side of things. For my student housing units everything is September 1st lease, and I ask for notice in February/March if they plan on re-upping or leaving. After that everything is up to my property management team. If asked what side of the fence I would be on though, I'd say I am team pro student housing because I know exactly what it is and it is cash flow each month that I know is going to be stable for the year and it is what it is .