- MarkyMarkMember@markymarkJoin Date: 2003Post Count: 132
Is anyone living in or has invested in student accommodation. I’m not talking about a granny flat. I mean a house located near a uni with a bunch of students in it.
If so I was wondering if I could get some comments on the pro’s and con’s of this type of investment. In addition, how is it being managed, like, do you lease out each room individually? or what? I think that this sort of investment might be a good idea, but I am sort of stuck on the pitfalls, I can see allot of potential issues with it.
Any comments, opinions or what ever much appreciated.
MarkyMarkKylie EMember@kylie-eJoin Date: 2004Post Count: 4
I am gonna put my 2 cents worth on living in this type of accomodation.
Myself and my partner have separately lived in large buildings with a whole heap of other people. They were all different ages and from all different backgrounds.
Here’s the bad news, noone gave a damn. If you get a bunch of people together living in an area that they don’t own they will party it up, break things, be disrespectful and sometimes not pay rent. I am being quite generalised towards young people here, I am speaking from being an ex youngy and still having young mates.
Hoping this helps!
Whatever you can do, or dream you can, begin it…SebastianMember@sebastianJoin Date: 2003Post Count: 55
I have not done this myself, but have spoken to people and have friends who have, but international students are ideal for student accomidation. More particuarly asian students, who are very quiet , studeious, clean and do not party it up as much as other students for example.
A friend of mine has a property in Como (Perth) close to Curtin University. He rents 5 rooms out to asian students at $100 p/w each and never has problems. I’ve been in there and the house is spotless!! The best thing also is he is getting $500 p/w on a $300K + property.
So yeah, student accomodation can be good, but you have to be careful.
Sebastiankay henryMember@kay-henryJoin Date: 2003Post Count: 2,737
There are different forms of student accommodation. The specialised types are when they have groups of apartments in a complex. There are managed by onsite managers. I stayed in one of these at the Sunshine Coast when I was at a Conference last year- it was new, with a pool, tennis court, games room, etc- frankly, it was lush. Banks don’t particularly like them- as in, you probably have to pay 30% deposit- that’s what my bank told me, anyhoo. API magazine recently did a big article on this form of student accommodation.
As for buying a house and getting students in, well, I lived in what could be termed “student houses” for most of my life. Basically, they were cheap to live in, and so that’s why students lived there- students not having much money etc. If you wish to charge each student say, $150 a week rent, so you are charging for the rooms, and not an overall amount for the house (and so you gwet a much greater return than you would on a whole house basis), then you might want to add in a few extras- lawnmowing etc… because it’s more like a boarding house arrangement than your average shared household.
Also, because you will be choosing the students, and they won’t know each other, then it’s more likely that they’ll be living there for study- and not lifestyle (unless they get to know each other [biggrin]) No students I know deliberately trash houses (and I’ve lived and worked with them since I was 19). But most young people are just learning how to live independently, and some may lack the skills of how to maintain a household. Others will live pristinely- it depends on the individuals.
I don’t see students as any different than anyone else. You can get a family who live like grots, or you can get students who live well.
You might want to furnish the house with desks and beds (double- noone wants to sleep on a single bed). You might also put in cable internet, because each student will be using their computers every day, and won’t be able to do that with one phone line.
kay henrylifeXMember@lifexJoin Date: 2004Post Count: 651
Be careful. If you rent more than 3 bedrooms in a property, then you become a “rooming house”, under the residential tenancies act (victoria anyway) and a whole heap of extra rules.
Also I know in some areas, that if you have more than 4 people living in the house than you come under a new set of council conditions called “prescribed accomodation” which can include things like requirements for health inspector checks and more.
And check insurance… i asked for an insurance quote on a share house and couldn’t get anything under $10,000 p.a. (no typo, thats $10,000). Good luck on claims if you don’t disclose this info and just get standard IP insurance.
I reccommend local legal advice, dangerous waters.
If you go through, approach the local universities off-campus accomodation officer, develop a good relationship and be genuine, they don’t take too kindly to people that come across as trying to rip poor struggling students out of their measly pennies, as many have tried to before.
lifexperiencegatsbyMember@gatsbyJoin Date: 2003Post Count: 708
I was a Uni student (several times!). I think if you invest in a niche property designed for o/s students that have all the facilities required, you may do quite well as the expense of studying here would probably negate the risk of time wasted in property damage, partying etc (this is still a generalization). When I rented my thoughts were on Uni life (partying, drinking, sex, typical portrayed late adolescent lifestyle/student behaviour, although this is not always the norm, I still have Uni friends and IP’s are about as important as paying an itemized phone bill!) This in my experience is in a suburban 3 bedder house. We always had a dog/s at parties, etc. I think you’ll find apartment student designed property will generally attract serious students who will one day get a job and finally realize they were better off partying and will hopefully end up on websites like this! They may make more astute PI’s as a result as well!
Just my thoughts (and some great memories).
Gatsby.1WinnerParticipant@1winnerJoin Date: 2004Post Count: 477
Interesting thoughts, memories and opinions.
I went to see an ex hotel turned into boarding house for sale, not long ago. The gross yearly rent from all rooms (forgot how many… ~15?) was over 56,000 and was rented to students in the local police academy. What looked as a fantastic return on the $400 asking price, ended up being a business that was making a loss, not able to service the mortgage.
After taking into account cost of a manager/cleaner/general duties, the cost of heating and mainteneace of an old building, this was a money pit waiting to happen. It ended up in the hands of a solicitor who needed to write off some of his “excess” income.
Yet I think that had I been a local, I could have managed and serviced this boarding house and made a mint every week even by employing others to do the menial tasks.
With multiple tenants, just like when you buy a block of flats, the money is in the numbers. I say, keep on looking into it, and it would be nice to hear from someone who owns a boarding house or a multiple tenants property.
May God prosper you always.[biggrin]
MarcMarkyMarkMember@markymarkJoin Date: 2003Post Count: 132
Thanks heaps for the comments, I really appreciate and value the various comments.
I have been doing some more research on it. So far, I don’t have much to report but I have about 2 full pages of questions and subject areas to look into.
I have quickly realised that there is a considerable number of things to be careful of and to research. It seems to me to be a higher risk type investment and there are some management issues that will require some creative thinking.
MarkymarkBuilderbhaiParticipant@builderbhaiJoin Date: 2009Post Count: 18
Me & my business partner bought a 5 bedroom house in Melbourne and converted it into rooming house. We are also converting the second lounge and the dining room into bedrooms, such that there will be 7 bedrooms.
It is making our IP into +cash flow.
Now the challenge is with the insurance. We are struggling to find an insurer who will insure a rooming house.
Does anyone know of a insurance company that will cover rooming house? Please help.basbogParticipant@basbogJoin Date: 2010Post Count: 58
I have student accomodation in Adelaide, 8 bedroom house, if you want the return it does not come for nothing, sometimes I don't have any hassels for 3 mths, then all at once, it is basically having 8 seperate tennants.
Don't have a lot of time now, however if you want to list questions, either pm me or on here I would be glad to help.