The Pros and Cons of Letting Your Property Out to Students
If you own a property in an area that is densely populated by local students, or if you are looking to potentially purchase a property that could be rented out to students, then you’ve likely seen plenty of money signs, as well as warning lights. The thought of letting a property to a bunch of outrageous students who drink too much and party too hard can scare away many potential investors, and to others is seen as a worthwhile business move. To help you make up your mind, here are the 3 biggest pros and the 3 biggest cons of becoming a student landlord.
Increased overall monthly rent
When letting to students, compared to letting to a family, you get the benefit of being able to charge rent per room rather than per house. So overall it is often the case that the monthly yield is much higher. This is especially true if you are able to convert the living room into another bedroom; students would go for this option but it’s unlikely a family would be as keen to.
Save money because students expect less
It’s not exactly uncommon knowledge that students are known for being a bit messier and a bit less fussy when it comes to where they live, and this offers landlords the chance to save money. In many cases, cheaper fittings, basic coats of paint and a few dents here and there will not faze students when they’re looking for somewhere to rent, whereas this could easily put off other potential tenants.
It shouldn’t be very hard to find tenants
In many cities in the UK, recent years have seen a continual upward trend in the number of university students, and as such this has led to an increase in the demand for housing. What this means is that, as long as your property is well situated, you shouldn’t find it too hard to find tenants, especially if you put in minimal amounts of effort by going to one or two housing fairs that campuses commonly hold between December and February.
More risk of damage to property
The nature of being a student is that you go to and also host a lot of parties. Your property will no doubts be the recipient at some point of a lot of drunk students who may be prone to damaging things. You will want to take care to be aware of exactly what is in the property and the quality it is in, and don’t go releasing deposits without thorough checks of the property.
Cost of insurance
Letting a house to students can in many cases mean that your insurance costs will go up, as they are perceived as more of a risk. Depending on where you are situated and the nature of insurance costs in the area, this may be a large and necessary cost for you to factor in, so be sure to do take this into consideration and do some quick searches.
Students aren’t there all year round
It’s important to realise that, unlike renting to a family, students don’t require housing in the summer months so your house will sit vacant during that time. This does offer the chance to deal with any necessary repairs and maintenance, but you will need to account for the fact that you will have no income from the property for up to 3 months of the year.
What this shows is that, if done properly, letting student properties can be a profitable endeavour, but there are challenges involved. Be sure to do your research into whether the demand is there and whether you can get something in the right location. If so, then you could be on to a good money-making opportunity, as shown by how many people already choose to rent to students.