Investing In Student Housing – Things You Need To Take Into the Account
If you want to enter into a lucrative niche of real estate, you can invest in student housing. The profitability in this niche is something which can make you rich in a matter of months. But then, there are some challenging aspects of this investment as well. Those challenging aspects might not let you earn bigger profits. The matter of fact is that the lack of planning can make this business endeavor quite suffocating for the investor.
Advantages of investing in student housing
- The first advantage of student housing is that you can get higher rent.
- Since parents are involved in the signing of lease agreements, you are likely to get guaranteed rents.
Disadvantages of investing in student housing
- Since most of the students leave school each year, you may have to wait for the new tenants.
- There may be more damage to the units.
Having that said, there are a few things that you may have to take into consideration if you want to invest in student housing.
Make sure that the school or college is not the commuter institute
The commuter college is an institute where the students need to travel to in order to attend their classes. It means that they are not required to live in the campus or the residential areas around it. And since your property will not qualify as a student housing property, you are not going to get the premium.
Community colleges and trade schools are usually commuter colleges. Institutes made for working professionals, who can take night classes, are also the commuter colleges. Large universities where full-time students study are, however, perfect for student housing.
Find right zone
From the perspective of distance between college and residential property, the classification may be done to make three zones.
- Zone A refers to the walking distance from the college. It is usually half a mile from the campus.
- Zone B refers to the biking distance from the campus. It can be up to 1 mile.
- Zone C refers to the driving distance which can be 2 miles and above.
Based on the real estate market, you can decide which zone suits you the best. Then, you can try to get the house in the required zone.
Look for the houses with more bedrooms
One of the most important things about rental property for students is that you will have to rent out the rooms instead of entire property. Therefore, you are in great luck if your property has more number of rooms.