Why do student housing units usually require college students to sign a 12-month lease, when students will only occupy the unit for the 10-month academic school year?
WPM Regional Property Manager Karen Houston explains, “Buildings do not take a summer vacation. More importantly, the costs associated with maintaining a property never take a break. That’s why we allocate expenses across 12 months. The result is a lower monthly payment for students, which makes our units more affordable.”
That said, some student housing facilities do, in fact, offer 10-month lease options. However, the 10-month option recoups the two months of lost income by requiring that renters pay a higher monthly rate or signing premium. In effect, 10-month leases end up costing the same as a 12-month lease—but provide less value.
So many students get creative to make a 12-month lease work for them.
“Students will stay longer into summer break than they otherwise might. Many may pick up a summer minimester course,” says Houston.
Another way students can recover some of their 12-month lease payment is by partnering with property managers to find their apartment’s next renter. For Houston’s properties, renters who assist her in finding the new occupant will receive a resident referral fee, which is equivalent to about $250.
“Student housing is unique because it is so transitory,” she explains. “Each year, about 50% of the building is turned over to new renters. This high turnover percentage means I am always marketing the properties.”
Houston has found that her best marketers are actually the students who live in her properties.
“If you want to know how to advertise, talk to your students! They are incredibly smart and tuned-in to technology and social media,” she says. “There is a perception that student renters will be irresponsible and cause damage to the building. But that has not been WPM’s experience. We have found them to be very socially conscious and eager to take their responsibility as renters seriously. They like it when you ask them questions and involve them in the process. Managing student housing properties has given me the opportunity to meet great kids from all over the world. They never fail to impress me.”