Letting to students
Students can be a lucrative tenant group, so it makes sense for you as a landlord to prioritise securing investment properties that cater to their needs. Those of you who achieve this will be in a prime position to cash in on the student market.
However, it is not as simple as buying any property and expecting students to flock to rent it. Instead, you should consider a number of crucial factors that determine success in this sector.
Location is of critical importance in your search for the perfect student house. Unlike other target markets that may be willing to compromise on the address of their home if the property itself is of sufficient quality, students will almost always want to be in a convenient location.
This means picking properties that are either close to a university or close to a transport option that links them with it. For instance, houses that are a few miles from a university but next to a train station or by a main road that heads to the institution can still prove to be popular.
While this is one consideration, you must also remember that students tend to be extremely sociable people, so will often also want good access to the city centre, where restaurants, bars and clubs are usually found.
Students like to live close to their friends, so picking a property in an existing student area can be a wise move. They also enjoy being in busy parts of a town with plenty of activity, so avoid quiet suburbs and rural locations.
It is a good idea to get in touch with your local Leaders branch, whose local experts will be only too happy to offer advice and opinions on which parts of a town are popular with students and what types of housing academics typically look for.
While location might be deemed the most important factor, there are other things you need to consider if you are to deliver a property that students want to live in. Students will certainly be looking for more than just a home in the right place.
Investing in a property with evenly-sized bedrooms is one good tip. Whereas a family will find it easy to decide who gets the biggest bedroom, students could be put off a property if one or more of the bedrooms are notably inferior to the others.
It is also important that you make an effort to provide furniture that is practical and useful to undergraduates, so invest in desks, chairs and wardrobes as these will all be valued.
Finally, get the décor right. Firstly, you need to make the home presentable, if not to impress students themselves, to satisfy their parents who may well be on a viewing and could be key in any decision. Also, you should go with a neutral theme so that your property can potentially appeal to both male and female academics.
As a student landlord, you have a number of legal responsibilities, so it is important to ascertain your ability to meet these should you start to let out a property. For instance, you will be legally required to keep the structure and exterior of the property in shape, and this includes drains, gutters and pipes.
You will also have to ensure gas, water and electricity is supplied to the home in a safe manner, while sanitation standards must be met.
There is also a raft of administrative tasks to be completed – just as there is with any tenancy – such as providing students with your full name and address, handing over a valid Gas Safety Certificate, ensuring you only enter the property when there is reason to do so and you have given adequate notice, providing a rent book if rent is paid weekly and holding a deposit in the Tenancy Deposit Protection Scheme.
You should also consider the likelihood that you will have to take plenty of calls when something goes wrong, as students are not renowned for their ability to liaise and several members of the same household could be in touch to ask for repairs, replacements or maintenance work.
Of course, allowing an expert in lettings such as Leaders to manage your student property will take the weight off your shoulders as we are able to oversee the vast majority of everyday duties and legal requirements.
If you are still in two minds over whether to let to students, you may wish to spend some time thinking about the numerous advantages of doing so. Perhaps the biggest plus associated with this practice is the potential to make a higher profit margin than you would from other rental markets.
After all, when it comes to letting to students, you stand to make more cash because you can rent out each room individually. And if you are willing to put some time into altering the layout of a property, you might even be able to squeeze an extra bedroom in the place of a dining room or living area, which will only serve to further enhance your income.
Over the years, you can make a huge amount of money simply by letting to students, and even more if you maximise the number of bedrooms that are available to each year's academics. Students often like to live with several friends, so if you can offer four, five or even six bedrooms your home is likely to become a hugely appealing option.
Another significant advantage of letting to students is that your property will appeal to a huge number of potential tenants – providing it is close to a university. If your property is in the right location, you can feel confident that it will remain occupied throughout each academic year.
Some towns and cities are in urgent need of more student housing, so identifying these locations and investing there gives you a good chance of seeing your investment pay off handsomely in the long run.
Students tend not to be as discerning about the accommodation they live in compared with families and young professionals, so you will not always need to spend as much money on keeping a home fresh and fashionable, although the property must always be in a good state of repair.
You will usually be required to offer a rental property on at least a part-furnished basis, but again the good news is that students generally do not expect high-quality, expensive furniture, and you can actually kit out a home for a relatively small amount.
Houses in multiple occupancy
Houses in multiple occupation (HMOs) are defined as properties in which at least three occupants reside and toilet, bathroom or kitchen facilities are shared. This covers many of the student homes in use across the country.
In addition, a property is deemed to be a large HMO which requires a licence if it is at least three storeys high, a minimum of five occupants live there and toilet, bathroom or kitchen facilities are shared.
As such, those of you who own a HMO or a large HMO have a number of standards you must adhere to and obligations they should meet.
You will also need to ensure proper fire safety measures are in place, the electrics are checked every five years, the property is not overcrowded, the cooking and washing facilities are adequate, there are enough rubbish bins in place and communal areas are clean and in good repair.