Renting to college students often requires little investment in advertising, because many college students actively seek alternatives to living on campus, or are unable to secure a campus-based dormitory because of lack of space. You have a steady stream of potential renters in your area, which makes a rental house investment less risky than owning a rental house where you rely solely on people moving into your area, or relocating within the same city. Depending on your housing regulations, you may be able to earn more money renting your house to several college students than to a single renter. For example, if you have a three-bedroom house and you charge each student $450 to live in the house, the $1,350 in rental income may be more than the $1,000 you could earn from renting to a single family or individual.
The United States has almost 4,500 post-secondary institutions scattered throughout the country, according to 2010 statistics from the U.S. Department of Education's Institute of Education Sciences. From a low of seven colleges in Alaska to a high of 436 colleges in California, you may own property in a college town with students looking for a place to live. Renting a house to a college student can offer you a steady income, but you may find that your community has restrictions on renting to college students.
Some cities limit the number of non-related people you have living in a rental home. This is to reduce the incidences of college parties or large numbers of students disturbing established neighborhoods. The cities often place a definition of "family" into their zoning laws as a deterrent to renting to students, according to New York General Counsel's office. Before offering your house to rent to college students, consult with your zoning department to determine how many non-related people may live in your house, and whether there are other restrictions such as having to provide adequate on-street or off-street parking.
Homeowner Association Regulations
If you own a home in a city that does not restrict rentals to college students, you may find that your homeowner's association regulations do. Homeowner's associations try to preserve the property values, neighborhood feel and control the traffic and noise by placing restrictions on homeowners. If you pay a homeowner's association fee each year, your home belongs in an association, and you are subject to the rules and regulations of the association. Check with the bylaws of your association before renting your house to college students to avoid litigation from your association.
While renting to college students can generate income, you should consider placing your own restrictions in the lease you have the students sign. Require that all students living in the house accept responsibility for the rent and any utilities you do not provide. Put in writing who will perform lawn maintenance and whether garbage service is included. If your zoning regulations require 12-month leases from all renters, consider allowing the students to sublet the house during the summer months. Making this concession will make it easier for you to rent the property to a student who will be in town for the school year, but who is going home for the summer. If you do not live in the same town as the property, hiring a management company to oversee and periodically inspect the house may help you avoid unnecessary damage from college parties or lack of property upkeep.
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