December 04, 2018
The Basics of Investing in Student Housing
Across Canada, university, college and other post-secondary education institution enrolment is on the rise. Getting on-campus housing is increasingly difficult. And, Canadian investors are starting to take note. According to the latest research reported on REMI, limited funding to Canadian universities was affecting their ability to provide enough beds to meet the increase in demand. As a result, investors are eyeing purpose-built student housing. In short, investing in student housing has never looked so good. And here’s why…
Something for Everyone
Whether you’re a REIT or first-time investor, there are a variety of investment opportunities. Student housing can be a large multi-unit housing facility with fully or partially furnished bedroom suites and amenities like common study areas, a gym and game room. But, student housing isn’t just a room with a bed and a desk anymore. It can also be a unit in duplex within walking distance of campus. Student housing offers something for every type of investor looking to get into this lucrative market.
The economy can boom or it can go bust, but, students will always need a roof over their heads while away at school. Multifamily returns are driven by job growth and job creation, and if that declines, this sector suffers. Student housing, on the other hand, is generally considered to be more resistant than other types of real estate investments to the volatility of any financial crises. When the economy suffers, in addition to young people looking for student housing, you’ll also see people who have been in the workforce for years head back to school for retraining. Student housing is always in demand.
So, you’ve decided to make the plunge and dive into the student housing investment market. Now what? You need to find a property that appeals to students. When evaluating properties here are some key things to look for:
- How close is it to campus? Can your student renters walk, bike or take a quick bus ride to their school?
- Is it in good condition? The days of the stereotypical rundown student housing are over. Students and their parents expect quality housing.
- Is the layout good for students? Is there an area where they can study and hangout? Can it accommodate roommates? (As many off-campus students have roommates you can often get a little more per square foot.)
Ask Yourself This
Before you make the final decision, ask yourself this question: Am I looking for passive income? If so, either hire a property management firm to look after your investment or reconsider investing in student housing. Student housing is more hands-on. There is more wear and tear, and more turnover. You will need to be involved much more than renting to a family.
Student-Specific Tech Needs
If you are considering investing in student housing, you’ll need to harness technology that’s geared to the needs of this particular market. These include:
Mobile and Text Friendly
It’s no secret that today’s young people do everything on their phone, from looking for rentals to applying to using them to contact the landlord about maintenance. Your student housing solution must be mobile-friendly and have the ability to offer communication by text messages.
Most students have no rental history. As first-time renters, they have no credit history, no references and no full-time employment. A lot of times, you might need a parent guarantor. Your software solution needs to be able to include guarantor information in the application.
Another need distinct to students? The ability to split the rent between roommates. A student housing solution must be able to handle built-in rent splitting.
Your student renters don’t use cheques. And, if their parents are helping out they want to be able to pay their child’s rent like pay all their bills: online. Student housing software enables online payment by EFT, debit, Visa and MasterCard.
As maturing adults, students are a little harder on properties and there may be more maintenance issues than your average non-student rental. It must be easy for the student renter to contact you 24/7. With an online communication portal, students can upload photos of the repair work, and authorize entry for the repairs.
How Property Vista Helps
If you’ve decided to invest in student housing, our solution is designed to make managing that property as easy as possible. Our student housing software helps you automate the marketing process, accept online applications and automate the approval process. It also integrates a resident portal makes it easy to pay online and request maintenance. See our pricing and book a demo today.