How to Manage College Town Rentals as a Landlord

Most landlords have several responsibilities in common: setting agreeable lease terms, screening potential tenants, collecting rent every month, and maintaining a working relationship with their renters. However, some situations can make renting a property a bit more complex. The experiences of the landlord and tenant alike are affected by the property’s location and the demographics of local renters. Specifically, college town rentals pose certain benefits for landlords as well as drawbacks. Dive into how landlords should handle college town rentals for optimal success.

Why Invest in College Town Real Estate?

You may be wondering why so many real estate investors purchase properties in college towns. One of the most significant reasons is that as a landlord in a college town, you’ll rarely have trouble finding tenants. 

In fact, since demand can be so much higher in college towns for rental properties thanks to large amounts of students coming in each year, the competitive market can lead to higher-than-average rent rates. This is a positive outcome for landlords, as it means they can easily earn what their property is worth and then some in rent.

Best College Towns to Own Property In

Take a look at a few of the best U.S. college towns in which to invest in property. 

Currently, Texas’s capital city of Austin is considered one of the most up-and-coming college towns. 

As the state’s fourth biggest city, Austin has become a hub for college-aged residents and is also home to a rising number of tech companies and working professionals. Additionally, home value rates are rising at a 38.6% annual growth rate

However, the Austin market has a high barrier to entry, with the median home price sitting at over $600,000. Less-established investors might prefer Oxford, OH, or Gainesville, FL. Both college towns boast a median home listing price of under $300,000.

Other great college towns and cities across the country include Provo, Orlando, Ann Arbor, and many more. Some cities have additional draws for residents outside of the nearby colleges and universities, such as desirable natural areas nearby, enjoyable amenities like theme parks, and plenty of access to employment opportunities.

Things to Consider as a Landlord to Students

Now that you’ve decided to rent a property in a college town, there are a few key details to keep in mind. Though college town rentals can be very successful for landlords, it’s important to ensure that you and your tenants are set up for success.

Make Sure You Have a Cosigner

Most college students are under 25 and still at least partially dependent on their parents, which means that you may have trouble finding a tenant in a college town with any significant credit or rental history to review. 

That doesn’t mean that college students can’t make great tenants, but it does mean that you should always have a cosigner on the lease with your student tenants to make sure that a safeguard is in place.

Rent to Roommates over Single Renters

Since college students often have lower incomes as they’re balancing work with school, it can be difficult to find a single tenant who can comfortably afford the total rent of a property on their own. 

That’s why it’s advisable for landlords in college towns to consider roommate arrangements over single college student renters in most cases. When multiple people are splitting the rent, they’ll be better able to cover the cost comfortably each month.

When multiple tenants rent a house, the landlord must decide whether to offer individual or joint leases. Individual leases allow landlords and tenants more flexibility. In contrast, joint leases are less risky and preferred by most landlords, but they might not suit renters who tend to move around often, like college students.

Perform Regular Inspections

Many college town renters are first-time renters, which means they may not be very experienced with spotting or taking care of issues that may arise on the property. That’s why landlords in college towns should perform inspections of their properties on a regular basis to check for signs of disrepair. 

However, landlords must include these inspections in the lease and give proper notice before entering a tenant-occupied property. Not doing so can lead to unhappy tenants and even legal issues.

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PayRent is on a mission to build a rent collection app that fosters a positive and productive relationship between renters and landlords. We focus less on transactions and more on the people behind them.

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