Student Investment Properties for Sale in Kitchener-Waterloo - WRX Property Group

Student Investment Properties for Sale in Kitchener-Waterloo


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#901 -265 WESTCOURT PL, Waterloo, N2L6E4

265 Westcourt Place, Waterloo, Ontario N2L6E4

3Bedroom(s)
2Bathroom(s)
UndergroundParking(s)
40Picture(s)
Bright & Beautiful Views At The Beechmount. A Spacious Corner Unit Featuring 3 Bedrooms & 2 Bathrooms. Walk Out To Open Air Balcony From One Of The Bedrooms Or Take It The Views From The Sun Room. The Wide Windows Allow For Plenty Of Natural Light In The Unit. Large Eat In Kitchen Opens To Dining Room & Ample Living Space.
$549,000

15 FIR ST, Waterloo, N2L3H4

15 Fir Street, Waterloo, Ontario N2L3H4

10Bedroom(s)
4Bathroom(s)
40Picture(s)
Location, Location, Location! Don't Miss This Newly Renovated, Fully Rented Investment Property , Located A Short Stroll Away From Laurier University And Lazaridis School Of Business, As Well As A Few Convenience Stores And Pubs - Perfect To Accommodate The Balance Of Study, Work And Play Lifestyle For The Newer Generation! 15 Fir Street Is A Side-By-Side Duplex, With A Total Living Space Of 3417
$1,180,000

32 MAYNARD Avenue, Kitchener, N2H4Z7

32 MAYNARD Avenue, Kitchener, Ontario N2H4Z7

5Bedroom(s)
3Bathroom(s)
Detached GarageParking(s)
45Picture(s)
Welcome to 32 Maynard Ave in the heart of downtown Kitchener, home of our Civic Centre, the Heritage District, Centre in the Square, and across the street from Hibner Park, (Old Berlin). One of the most desirable areas in the Kitchener area. The best feature of this home is the old charm.
$999,000

223 ERB Street Unit# 1101, Waterloo, N2L0B3

223 ERB Street, Waterloo, Ontario N2L0B3

4Bedroom(s)
3Bathroom(s)
UndergroundParking(s)
50Picture(s)
This stunning 11th floor Westmount Grand Condo, with 4BR/2.5+BA. in 3741 square feet, is an exceptional residential space, offering premium finishes and extraordinary cityscape views. Formerly two units, now seamlessly combined, the luxurious interior features large and spacious rooms, rich hardwood flooring, a sophisticated colour palette, 9 ft 7in ceilings, and plaster crown moulding throughout.
$2,495,000

#303 -253 LESTER ST, Waterloo, N2L3W6

253 Lester Street, Waterloo, Ontario N2L3W6

5Bedroom(s)
2Bathroom(s)
40Picture(s)
**$3250 Rent Every Month** 5 Bedroom 2 Bath, Layout Is Attached, Fully Tenanted, Spacious Living, Dining & Kitchen, Fully Furnished, Turn-Key Investment, Each Room Has Large Windows. Steps To Waterloo University Campus & Laurier. Walking Distance To Shopping, Restaurants, And Many Other Amenities.
$609,000

1100 COURTLAND Avenue E Unit# 512, Kitchener, N2C2H9

1100 COURTLAND Avenue, Kitchener, Ontario N2C2H9

2Bedroom(s)
1Bathroom(s)
Attached GarageParking(s)
33Picture(s)
Amazing opportunity to own large 2 bed, 1 bath plus storage in all inclusive condominium (hydro, heat, water). This great suite features custom built kitchen recently renovated, fully renovated bathroom, spacious balcony, freshly painted and more.
$459,900
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Benefits and Drawbacks

There are no opportunities that are 100% perfect and guaranteed to yield nothing but positive results (just ask the tens of thousands who flocked to the Klondike Gold Rush). Reaping rewards always requires a bit of risk, and a willingness to put in work where necessary. Investing in student housing has its ups and downs, yes, but as you’ll see, it’s a much safer bet than the Klondike Gold Rush.

 

Divide and Prosper

A distinct benefit to student housing is that the home owner is often able to break the home or condo down into individual units. Rather than renting out an entire house or apartment to a single family, for example, you can rent it out per room. Many students will be looking to rent a single room, as opposed to an entire apartment.
 
This generates a higher cash yield, as the cumulative rental fees for each unit together will be more than the rent for the entire unit (think about buying something in bulk versus buying individual – three individual chocolate bars will cost more than a pre-packed three-pack).
 
The specifics of how you divide a student rental property are ultimately up to you, though – as are factors like price per unit, and utilities. Having fewer units means fewer students from whom to collect rent, but it also means a lower overall price.
 
Multiple rental units within a home or apartment take more time to manage than one large unit, but can ultimately be more financially rewarding. On the other hand, renting out the apartment or home all-in-one can take less time (in terms of finding the student(s) to rent it, collecting rent, etc.), but may mean less profit overall.
 

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Rental Cycle

This is another one of the ways in which student housing differs most from other homeowner/renter dynamics. Many universities and colleges run on reliable semester systems, so as an investor, you can predict when student tenants will be leaving, and when more will be coming in. University of Waterloo’s semester system is a bit different, so students there may have a greater likelihood of staying year-round.
 
In any case, student renters are more frequently on a measured, short-term basis than other types of renters. Even students who choose to remain in the unit between semesters (if the terms of your lease permit that) will only be attending the university or college for a matter of years.
 
The more rapid rental cycle has some benefit: tenants who aren’t working out for you won’t last long, and because new leases will be signed every time new students come in, you are much more flexible with changing the price of rent. Owners are limited with how much they can increase rent each year with long-term tenants, but with potentially new students each year, you can adjust the price of rent to both remain competitive and maintain an ideal cashflow.
 

 

Maintenance

Another consequence of high student turnover is the need for maintenance. This may mean the need for preparing the property for showings (and new rentals) each year, including painting or repainting, fixing any problems, and so on. Indeed, by and large, student rentals do entail more maintenance requirements. Students themselves are typically higher maintenance and ultimately higher risk.
 

Effect on Mortgage

Because students are higher risk, and because they typically require more maintenance, investing in student housing can affect your ability to get a mortgage. It also might impact your ability to easily get mortgage insurance. Mortgage lenders often see student housing as higher risk, and this can affect the offered rates.
 
So what can you do to offset this? One way is to try to find a mortgage professional who has experience in the student rental market. As we’ll explain shortly, this is a rapidly growing market, and it shows no signs of slowing down. Another way to offset mortgage-related worries is to save for a larger down payment. Lenders may end up asking for a down payment 10-15% higher than the typical 20%.
 
Finally, a variable that can affect mortgage lenders willingness to offer a mortgage, and one with a competitive rate, is whether or not the owner will have a child living in the property. This casts a different light on the property than one that is purely a student rental, though of course this is not an option for everyone.
 
It’s worth noting, however, that parents with a student heading off to college or university do have a great opportunity to purchase a home and rent it out to their child and fellow students or their child.
 

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Manage That Property

Many successful student rentals make use of a property management company. As we’ve noted, there can be much more upkeep involved in housing students: for many of them, it’s their first time living away from home, and students do have a (not unwarranted) reputation for less tidy living and a propensity for parties (large or small).
 
Of course, it’s ideal to carefully choose which students become tenants, but the fact remains that student housing will, on average, be more demanding of time than families, young professionals, couples, etc. A property management company can handle all the day-to-day tasks for you, ensuring a minimal headache for you while retaining your ability to tap into this growing market.
 

 

The Price of Student Housing

The student market has the potential for great financial rewards to those willing to take a few more risks than the standard rental course. This does mean, however, that there will potentially be more competition for prime student housing (particularly areas near the campuses). Because many investors will be looking to purchase these properties, the average overall price of student housing can be higher.
 
However, it’s important to look at this as somewhat of a good sign: if a home is generating that much interest, then clearly both the area and the overall market are desirable.
 

 

Conclusion

Student housing is a real estate market truly on the rise. In part due to the fact that many students only live on-campus for first-year, and then look elsewhere for housing, each year ensures a very large influx of potential renters.
 
Both universities in Waterloo (University of Waterloo and Wilfrid Laurier University), and Conestoga College in Kitchener, are seeing steady growth in their student populations. Post-secondary education is becoming more attainable, and each year will see a new batch of students looking for student housing. It’s a fine time to get into this market.
 
Student housing may take more work, but it truly has the potential for financial gain: both short-term and long-term. If you’d like to buy student housing in Waterloo, Kitchener, or Guelph, we’d love to help. Please feel free to contact us if you’d like to know more!
 

Written by Will Kummer

 

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