Ultimate Student Housing Real Estate Resource

Last Updated: April 2024

Universities and local community colleges across the country have students that are either relocating to attend school or large student populations that the school cannot entirely house themselves on-campus. Investors have been privy to this supply and demand of apartment rental housing close to campuses, and created a type of residential rental property investment class called “Student Housing” which specifically targets students as tenants. Below we take a deep dive into everything you need to know about student housing rental properties.

What is Student Housing?

Student Housing Definition

Student Housing Rentals

A student housing property is a type of rental property that is specifically designed to provide housing for students. These properties are typically owned and operated by universities or other educational institutions and may be either on-campus or off-campus. Student housing properties typically include various amenities and features designed to meet students’ needs, such as laundry facilities, study areas, and common spaces.

Student Housing Explained

Student housing is a type of housing that is specifically designed for students who are attending a college or university. These properties are usually located near the school’s campus and offer amenities geared towards students, such as study lounges, fitness centers, and laundry facilities. Students are always in need of a place to live while they attend school, and by investing in student housing, you can provide them with a comfortable and convenient place to live. One of the best things about student housing is that it is usually leased on a per-bedroom basis. This means you can earn a higher income if you own an interest in a property or properties with multiple bedrooms. Each student who rents a bedroom in your property will be paying their own share of the rent, which can add up to a significant sum of money over time.

4 Types of Student Housing Properties

Student housing is an off-campus housing facility for college students who may have graduated from the dorm room experience and are potentially looking for more privacy and independence, among other things. These apartments or houses are usually owned by landlords and are becoming preferential accommodations for students due to the rising costs of dorm fees. We take a look at each type below.

Shared Houses (HMOs)

Shared Houses (HMOs) Student Housing

Shared houses, also known as Houses in Multiple Occupation (HMOs), are typical residential properties that have been adapted for multiple students to live together. These homes allow students to rent individual rooms while sharing common facilities such as the kitchen, living area, and bathrooms. Given the presence of multiple unrelated individuals under one roof, many jurisdictions mandate special licenses for HMOs. They provide an affordable student housing solution, striking a balance between individual privacy and the experience of communal living. Positioned within residential areas, these houses often exude a more “homely” ambiance compared to purpose-built student residences.

Purpose-Built Student Accommodations (PBSA)

Purpose-Built Student Accommodations (PBSA)

Purpose-Built Student Accommodations (PBSA) are modern structures tailor-made for the student demographic. These accommodations can range from shared flats with individual bedrooms to self-contained studio apartments. They often boast on-site amenities tailored to student life, including gyms, laundry rooms, and communal lounges. Serving as a ready-made solution, these units are typically furnished and situated close to campuses, ensuring student convenience.

Studio Apartments

Studio Apartment Student Housing

Studio Apartments are compact living units that merge the functions of a bedroom, living room, and kitchen, usually complemented by a separate bathroom. These are especially popular among students seeking privacy and independence from shared living environments. Often located in urban areas, these units might come at a premium compared to shared spaces but guarantee a dedicated personal environment. Some studios, especially in student-dense regions, might come furnished or semi-furnished, easing the transition for students.

Private Flats & Apartments

Private Flats & Apartments Student Housind

While not exclusively constructed for students, remain a popular choice among this demographic. Students can lease these properties either individually or as a group. These apartments range in size and are versatile in terms of space, location, and amenities. Some landlords, recognizing the student demand, might even furnish these spaces. Being situated in both urban and residential zones, they allow students a deeper integration with the broader community.

Student Housing Property Management

Managing student housing properties requires a unique skill set. From dealing with parental cosigners, frequent turnover, roommate disputes, and the occasional unruly “party tenants”, managing a student housing property is a vastly different endeavor from managing an apartment building. By leveraging property management technology and staying up to date with the latest student housing industry amenities, your property can increase its likelihood of satisfied tenants and abundant profitability. 

Top Student Housing Real Estate Tools

Student Housing Investing

Student Housing Investing Strategies

Student Housing Investing

Investing in privately-owned student housing real estate has emerged as a lucrative niche within the property market. Given the consistent demand for student accommodations in areas with universities and colleges, these properties often promise stable rental incomes and high occupancy rates. Additionally, the cyclical nature of academic sessions allows for periodic adjustments in rental prices, potentially leading to increased returns over time.

Financing Student Housing Purchases

Financing Student Housing Purchases

Financing student housing real estate requires a thorough understanding of the unique characteristics of this property niche. Traditional lenders, such as banks and credit unions, often provide loans for student accommodations, but terms and rates might vary based on the perceived risks and projected rental incomes. Private investors can also consider partnering with real estate investment trusts (REITs) that specialize in student housing or seek out alternative lenders.

Top 5 Largest Student Housing Companies

American Campus Communities
Asset Living
The Scion Group
Cardinal Group

The student housing sector is an essential niche in the rental property market that caters to the unique needs of the student population. The largest student housing companies in this field specialize in developing and managing housing solutions that are not only close to educational institutions but also tailored to the lifestyles and budgets of students. These firms focus on creating safe, convenient, and community-oriented living spaces, often incorporating amenities like study areas, internet access, and communal spaces to foster a conducive learning environment.

Student Housing Calculators

Student Housing FAQ

What Types of Lease Agreements are Used in Student Housing Leasing?

Individual residential lease agreements are commonly used for student housing, where each student is responsible for their own rent, allowing for personal liability rather than collective. Alternatively, some properties may opt for joint leases, where all tenants in a unit are jointly responsible for the entire rent, which can be riskier for landlords if one tenant fails to pay.

Do You Need Special Licensing to Lease Out Student Housing?

Special licensing to lease student housing is not typically required beyond the standard landlord or property management licenses required by local regulations. However, investors must ensure they comply with all local housing codes and ordinances specific to rental properties, which can vary significantly depending on the location.

More Types of Rental Real Estate

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