If You Have Been Watching Rental Housing In California
You realize that rental prices are increasing faster than wages are increasing.
This is not a good sign for renters, and talk of Rent Control is coming to the forefront again in many cities. But there are still some areas to invest.
It is estimated that housing for students will keep growing and prices are increasing.
Now, this is not easy property to manage. I have several properties in over 55 housing. Love the tenants. They have their budgets established. Fewer evictions. Less damage. Fewer wild drug parties. Maintained landscaping. But there are fewer possible tenants, high HOA fees, and you have to deal with Project Managers and Boards. Enough said.
You could rent to students, and your beautiful property becomes an “Animal House”. For younger readers that is a movie from 1978, and the fraternity destroys the rental. Belushi and friends make this a good comedy, but it would not be funny if you were the landlord.
Some Tips For Student Housing:
No carpets, tile; no drapes, commercial blinds; no fancy landscaping, junipers; consider month to month rentals so it is easier to get rid of bad ones; collect the rent at the property monthly (perhaps hire an offensive lineman from the school) and you will see what is happening; locks on all the bedroom doors; check always for extra tenants; strict rental rules including parking; no pools for sure; include in the rent monthly cleaning; use living room for study room and this means less traffic than a TV room; consider co-ed (my daughter’s first restrooms at CAL were coed in 1999); and did I mention that you should consider co-signers on all rentals, etc. etc.
A four-bedroom home is best, one more rental, consider bunk beds. I lived with bunk beds for four years at IU, and it did not severely ruin me for society.
Consider Having Your Child As One Of The Tenants
When you buy the property, you could buy it as an Equity Share with both of you on title. That means better loan rates and perhaps a lower down payment.
Yes, renting to students is tough management just as renting to children, etc. But sometimes they work out well and the returns are better.