college town
By investing in college town properties and providing college room rentals, I have been able to consistently double the rental income on a property when compared to single-family rental properties in the same college town.
Over the next 4 years and after much trial and error, I created a system that allowed me to make money quick. This process allowed me to cut the amount of time spent on my rentals to less than an hour a week and still maintain sizable profits.
Check your local city laws first to make sure everything you’re thinking of doing is legal and up to code. Some cities may require you to get a business license to rent by the bedroom.
Choose a college with a good market size to rent your bedrooms. These types of colleges also offer opportunities for higher degrees such as medical school, pharmacy school, and nursing school. These types of students would rather not waste their time in college partying.
Determine market demand and how much rent to charge if you can put two people into one bedroom (like a couple).
Figure out what people are paying for bedrooms using sites such as Craigslist. Also, consider putting couples into a single bedroom to charge more for that bedroom.
Try to find properties located in close proximity to campus so that you can charge premium pricing. Also, look for houses with plenty of parking. Check out the neighborhood to make sure it’s a good area so the parents feel safe letting their children stay there.
Even just adding one extra bedroom to a house will pay for the majority of repairs and expenses that come up on your house throughout the year. Doing this step also typically allows you to at least double the amount of rental income and cash flow you make on the property.
Create demand and urgency by highlighting the benefits of staying in your bedrooms vs on-campus housing. Advertise in the areas where your target market (i.e. college students) hang out.
Empower your tenants to take on certain responsibilities. One way you can do this is since students are tech savvy, have them may make rent payments through a phone app called Zelle. Zelle gives real-time deposits so you know when rent is paid late.
A brief word about landlord and tenant laws:
The landlord has legal responsibilities and expectations and the tenants have legal responsibilities and expectations. If tenants are not paying rent and/or are in other violations of the lease agreement and you feel you need to begin the eviction process and deliver a notice to vacate, or any other official process, ensure that you conduct business in alignment with local and state laws.
I believe real estate investing should be fun, simple, and enjoyable rather than this big intimidating beast you have to slay – remember the dragon from Game of Thrones? The best part is that it allows you to give back and provide affordable housing.