There are also Landlords who are just beginning to rev their engines right now, as the opportunity is beginning to knock for Landlords in London, Ontario.
Since we are about 50% into the leases around Western University (UWO) who typically sign a 12 month lease starting May 1 each year, there are several properties around the university that are:
- Currently vacant
- These rentals were not rented for May 1, or even September 1, and this is usually due to location, price, but mostly quality of the home
- Owners of these homes are not “doubling down” on their homes (i.e. not generating income and investing in the quality of the home) they are simply content with losing money each month hoping that the house rents out
- Homes around Western University in London will not be rented out to new groups of tenants until May 1 of next year (when the current lease expires)
- Landlords who are vacant for 6 months, are tapped out for cash, are now selling their properties around Western. Most of these houses can be negotiated, as they are currently vacant and are more of a liability than an asset
This situation is one that is ultimately unfortunate: there is a good location property, that used to be good enough for students around Western to rent out, but due to Landlords not updating the house, not investing in repairs, maintenance, and cosmetic upgrades, or maybe even being greedy on the rent price, the house has been vacant and it’s a huge liability to the owner who has lost several thousands and does not want to have anything to do with their property anymore. At this time is where an experienced landlord around Western University can secure, invest, rent and even sell/hold a property that will generate income for them.
Securing a property for a good price around Western University now is very beneficial since many Landlords are hurting for cash. Their property has not been rented in 6+ months, it’s in rough shape which needs cosmetic upgrades, and you can offer fair but under market value offers for these properties.
Investing in this type of property makes financial sense, if you know what you are doing. Specifically focusing on cosmetic upgrades (paint, flooring, light fixtures, kitchen cabinets/countertops) as well as regular maintenance/repairs will breathe new life into the property which will allow you are the owner to do two things: charge top dollar for rent for students looking in January (to secure a May 1 lease) and will build up the resale value of your student rental property.
Renting the property should be very simple in this specific example. Since the property around Western University will be clean, empty, renovated cosmetically, the maintenance/repairs will be taken care of, and then the property will show well to prospective tenants. Note that the rental season starts at the beginning of January, and since your property is currently empty, you can show it anytime and it will always be clean as well.
Although you have may hold onto the property for several months buying, fixing, renting, and waiting for a group to start paying you rent, this must be factored into the purchase price of the property. Having said that, if you are looking to maintain the passive income stream generated from the property than it is best to hold onto your newly created turnkey investment. If your objective is to sell the property as a turnkey investment to a real estate investor then you will also reap the benefits of your venture. This all depends on what type of Landlord and investor you are: while some are kicking up their feet as we approach the winter, others are revving up their engines.