According to Gillian Irving, student rental investments are designed to be 100% passive for investors, particularly time-crunched business owners and professionals who want asset diversification without handling day-to-day property management nuances. The strategy generates above-average rental income and cash flow without requiring costly or risky renovations.
The pandemic created uncertainty around September 2020 campus reopenings, with many universities moving to online or hybrid models, which led students to question whether they needed to return to their college housing. This raised concerns about honoring lease obligations and monthly rent payments, requiring landlords to educate tenants on their financial responsibilities and available government resources.
Gillian Irving points to the last economic recession, where students returned to school in droves because there were fewer jobs available, using the time to upgrade certifications and become more qualified for the job market. She anticipates that enrollment will rise again during economic challenges, which means increased demand for student rental properties.
Dalia Barsoum recommends keeping a master lease agreement instead of multiple individual room rental agreements, purchasing with vacant possession rather than inheriting existing student tenants, and working with alternative lenders or credit unions because most of the big five banks do not finance student rentals, typically offering financing at 65% to 75%.
While low interest rates reduce carrying costs and put more cash in investors' pockets every month, they also drive more buyers into the market, making it trickier to acquire properties and potentially pushing purchase prices higher. This creates a trade-off where investors may pay more upfront for properties despite lower monthly carrying costs.
