Leasing to Students - Advice Needed

LMintCondition on 22/02/2022 - 21:16
Last edited 23/02/2022 - 01:02 by 1 other user

Hey everyone.

So I purchased my first investment property last year and spent the past year painting and touching it up during the weekends. It is a single level unit and approx. 15min walk from a uni.

It has been listed for lease and been on the market for a few weeks now. I had to reduce the lease by 5% as there was not much interest shown.

3 students have just applied for my place and I'm a little cautious about giving it to them. 2 males, 1 female 19-24YO coming from regional suburbs. My agent said that leasing to students can be hit or miss.

What do you guys think? Is it something to worry about?

Cheers

Poll Options

  • 9
    Wait for other offers
  • 35
    Nahh relax
Home & Garden

Comments

  • JimmyF on 22/02/2022 - 21:22
    +24

    What do you guys think?

    Well you did buy a IP 15 mins walk from a uni, students are your key demographic in the area, so……..

    • MintCondition on 23/02/2022 - 08:11

      It was inevitable that students were going to apply but i was lowkey hoping for more mature aged tenants :/

  • Stewardo on 22/02/2022 - 21:29
    +5

    How much did you save spending a year of weekends painting it vs paying someone to paint it for a week?
    And then claiming the painting on tax?
    If you have landlords insurance who cares about quality of the tenants. You need cashflow

    • Ghost47 on 22/02/2022 - 21:45
      +3

      Probs bought it as a PPOR to cash in on FHB benefits and pretended to live in it the past year.

      • Stewardo on 22/02/2022 - 21:53

        Maybe but isn’t FHB 6 months

        • Ghost47 on 23/02/2022 - 10:27
          +1

          It’s 12 months for Vic.

    • Quantumcat on 23/02/2022 - 09:22
      +1

      Plus a year of lost rent

      • MintCondition on 24/02/2022 - 14:31
        +1

        depending on rent amount and property price, the stamp duty savings can be greater.

  • AustriaBargain on 22/02/2022 - 21:32
    +2

    Maybe you should have targeted international students who might be able to pay a bit more. Though with semester already started it might be a bit too late to be choosy. You gotta assume there will be parties and kitchen fires. Also bedroom fires, students will try to dry clothes directly on radiators and such.

    • George Washington on 22/02/2022 - 23:33
      +2

      and orgies

    • MintCondition on 23/02/2022 - 08:13

      Thats exactly what I am worried about. Not sure if its worth losing rent for a few more weeks but finding more mature tenants

  • Derrick Crane on 22/02/2022 - 21:37
    +1

    Sell it

    • elgrande on 22/02/2022 - 22:25
      +1

      Knock it down

  • p1 ama on 22/02/2022 - 21:42
    +7

    You purchased a unit 15 min walk from a uni, who did you expect to be leasing it to?

    The reason why it's been on the market for a few weeks and there's been no interest is because all of the students are still on holidays and there's still no international students around. Students coming from regional suburbs will tend to be your best bet.

    I wouldn't say that leasing to students is "hit or miss", it's just that there are certain things to be aware of when leasing to students:

    (i) Students will not stay for long, so you will be renegotiating contracts fairly often. If you have a good agent, this won't be an issue, if you have a lazy agent or are managing yourself, this is an issue.

    (ii) Students are highly price sensitive and not particularly welded to a place. They generally do not have many possessions, have plenty of time to shop around and move, if you're not offering the sharpest prices, they'll move out. It's not like a family who may lease from you for years and have plenty of furniture, get used to the area, become attached…etc. such that you don't have to be the sharpest with pricing.

    (iii) On the flip side, all of my friends who've leased to students have only generally had good things to say. Students are generally not home much, aside from potentially having parties, they do not cause wear and tear the same way that pets and kids may. I've also heard that students are overall reasonable and easy to deal with.

    FWIW, advice from someone who's advised a lot of people on property investing and seen it be a cash cow for some and a source of complete stress and frustration for others - you sound like you're worried about potential damage and wear and tear to your property, especially given you've spent a year painting it and touching it up (how this takes a year, I don't know). If someone spilling stuff on your carpet or kicking a hole in your wall is something that particularly bothers you (as in emotionally, on top of just taking the bond money and getting someone to fix it and not caring less), you should not be investing in property. Put your money in shares instead and save yourself the emotional turmoil.

    • MintCondition on 23/02/2022 - 08:18

      Thats really good advice, i appreciate it. Its just a risk I have to take on I guess. I agree that students are less fussy. There is some emotional attachment with the unit since it was my first little project

      • dasher86 on 23/02/2022 - 10:18
        +4

        Remove emotional attachment or do not rent it.
        Everything little thing will annoy you, whether it is damage or 'wear and tear'.

        • brazen00 on 23/02/2022 - 10:32

          This. I had a landlord who was emotionally attached to the property and lived nearby. Always dropped around to water the garden and such. Couldn't wait to get out of there.

  • mapax on 22/02/2022 - 21:45
    +2

    Is the unit currently in MintCondition?

    • AndyC1 on 22/02/2022 - 21:59

      Must be in Canberra near the mint then.

  • AndyC1 on 22/02/2022 - 21:59

    Love the details, suburb, uni, lease length? Background checks performed w.r.t. ability to pay by the REA… etc etc.

    Never heard of a "regional suburb".

    • plmko on 22/02/2022 - 22:13

      Trust me bro

    • MintCondition on 23/02/2022 - 08:31

      background checks are underway by REA. They never lived together before. LaTrobe Uni. Students are coming from regional victoria

      • Ghost47 on 23/02/2022 - 10:57
        +1

        I would be very wary trusting the REA to do a good job.

        You put so much effort into the place and you’re emotionally attached to it, why are you not managing it yourself? Letting others take care of it will compound the risk.

        • Euphemistic on 24/02/2022 - 16:23

          I would be very wary trusting the REA to do a good job.

          If they don’t have much history, doesn’t matter how much ’work’ the REA does, they are an unknown quantity. Could be perfect, might live like the Young Ones.

  • Godric on 22/02/2022 - 23:12
    +3

    Sell and put all $ into Crypto

    • Baysew on 23/02/2022 - 01:03
      +1

      Now your talking hit or miss.

  • payless69 on 27/02/2022 - 12:58
    -1

    Either sell or drop rent.
    BUT: Screen applicants and set minimum requirements: No real platinum credit card no rent and lease ends when card expires. Can be renewed when replacement card gets registered. Such students do exist but be reallistic with rent, serious postgrad students generally understand how things work.

Login or Join to leave a comment
Login Join