Student Rentals: Pros and Cons

Student rentals are the backbone of my real estate investing career. It’s how I got my start and I still invest in them regularly. There’s a lot of money to be made in student rentals, but there are some specific considerations that you have to take into account that don’t apply with other types of rentals. Here are some of the pros and cons.

Rob and Heidi Living Room


  • When you’re dealing with students you can rent by the room, which increases your bottom line.
  • There’s no need for expensive finishes like granite and hardwood; units need to be functional, clean, and well done, but high-end materials won’t give you a return on investment.
  • You won’t have any trouble finding tenants. I have yet to find a university or college town that didn’t lack student housing.
  • In many cases you’re dealing with young people on their own for the first time, so you can usually ask that parents co-sign the lease. It makes the default rate very low.
  • While there’s a high turnover rate, it’s a predictable rental cycle. Leases start and end at the same time every year, which means only having to deal with it once every 12 months.


  • You might only need to worry about renting once a year, but depending on how many rooms you have available, that still means a lot of applications and a lot of screening.
  • Being on their own for the first time means that students  aren’t always great at taking care of their temporary homes, and they’re not always the most responsible tenants. You may not get as much pride of ‘rentership’ than you would with a long-term tenant.
  • Student rentals require a lot of maintenance, mostly due to turnover and neglect.
  • You have to keep in mind that your tenants are often leaving their parent’s house for the first time and may not know how to deal with simple issues around the house. This means that even small things like changing light bulbs or tripped breakers may result in a phone call or house visit.

An important thing to consider with student rentals is whether you want it to be a dedicated investment property or a secondary suite within your own home. If you’re considering a secondary suite make sure you check out these pros and cons.



Photos courtesy of RTR Media / Income Property

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