Renting rooms to Uni students...Am I mad?

I am thinking of buying a six-bedroom house near a University. It is for sale for $250,000 and I can charge $110 per week for each room (plus utilities). If I give it to a property manager to handle the letting, and if I accept only full-time students, and if I furnish it with chunky hard-to-smash furniture, and if I also pay a cleaner to clean the common areas for 2 hours every week it seems like an OK deal to me. I have heard some horror stories, and they are putting me off a bit, but should I look beyond the negative and go for it? It isn't really a super-huge outlay after all... I went to Uni (nursing) and I saw the good and the bad. I am very undecided. Any advice is very welcome. Thank you. :) Theresa.
Have a search in the forum here. I have posted on the subject quite a bit.

Do a google search on: "propertunity" "student accom"
few on here have done it ... one successful one in my area only rents to medical students. Always full and never any probs because they are too busy studying to party.

Makes me think that not renting to arts students is the way to go - perhaps stick to engineering, IT or medical.
Makes me think that not renting to arts students is the way to go - perhaps stick to engineering, IT or medical.

I studied software engineering - An IT engineering degree. We studied hard, but I do recall a few wild parties. :)

Seriously though, the yields on this type of arrangement can be very good which is what makes it very attractive. There are a few pitfalls...

1. It's not really an investment, you'll be in the business of providing student accomidation. The people who are successful are those who treat it as a business and work on it. Don't treat it like a passive investment.

2. Once the banks know it's for student accomidation, you'll find it very difficult to get finance over the property.
How are the numbers with 9 months rent per room, one room empty, plumber every 6 months to unclog the drain, mould treatments every 18 months as students cook and microwave etc in their rooms, and new furniture every three years? Worst case scenario but you get the idea. I live near a uni and such properties are handed down from investor to investor until they are in such a state nobody wants to buy them.
When I started uni I lived in a 6 bedroom house which the owner rented out room by room. He supplied the fridge and a few other things, nothing major. The biggest problem back then was the telephone. With so many people it was hard to keep track of who made what calls. These days no one uses land lines, but an internet connection would be needed - be careful of download limits.

And watch out for insurance problems.
If done properly and managed well they can be a great cashflow proposition but you do need to be aware of the pitfalls discussed in this and other threads. Also watch out for the legality of leases and the no. of students per house as insurance companies will investigate here for potential claims if the "limit of tenants" per dwelling is excessive.
Best of luck.
Everything said above sounds like solid advice, but the basic idea is brilliant if you can pull it off, I think. More a business than a rental - which means lots of your time will be needed - but the payoff sounds handsome. I met a chap last year who's onto his 4th such house, and for him it's a full-time but highly profitable business model. This suggests to me, properly done, it's a great niche business - with all the caveats regarding finance (i.e. big deposits, etc) that come with it. Don't make the mistake of thinking it will be easy money though. You always end up working for what you get in this world, one way or another.
I "managed" I suppose is the best description a house rented to uni students.
In return for the master bedroom at a reduced rate I collected the rent. Paid bills, prompted people to clean up etc. Mowed the lawn as required.

Any issues I contacted the landlord.

There was quite a high turn over in people, especially the 1st years dropping out. Disputes over power bills etc were a constant problem as well. Always seemed to get one that would run a heater 24/7.

Parents being guarantors was pretty much a necessary requirement for the landlord as people quite often fell behind, move out and did not pay last few weeks rent.

Think about sealing the dirveway/carport against oil leaks. Its amazing the mess just one old car can make.

That said the income was above average rent and students are less fussy if the paint has a few marks or the carpet has a funny stain in one spot.
Actually the place I was in had painted concrete in the living area!

Edit: Don't limit yourself to uni students either. I was an apprentice so the owner knew I was unlikely to go anywhere for 4 years.
BuildingBlocks is spot on. Just make sure your rent covers the "guests" that spend a lot of time there. It is not uncommon in Sydney to have 5 or 6 people in a 2 bedroom apartment. Of course only 4 people are there but these "guests" seem to visit a lot. No problem. As long as it is factored into the price.

Personal experience E.g. 2 bedroom apartment Kent Street Sydney market rent $600 per week. Renting to asian offshore students $1,000 per week. 2 on the lease. How many in the apartment. Of course 2. Who am I to police if their friends stay with them.

Love overseas students.
Since you're paying utilities, you'll get $3000 electricity bills very often. If you split the bill, how do you attribute who used what? Who's been using the heater?

No one wants to stay there during July or between November and January. So you have 4 months empty every year.

Kids come and go. With 6 rooms you probably have to lease them all out every couple of months. So really you're managing 6 houses, but 6 that breakdown very often because they keep clogging the toilets, bursting the toilet pipes etc.

Ah that's right... that's what you'll be left with after a few wild parties. And awesome foursomes in every room - that's 24 people for 6 rooms eeek!!