What are your thoughts re: renting to overseas students?

[kennyboi]

I advertised my apartment in inner west Sydney for rent recently on gumtree. One of the prospect is a group of 3 overseas student (2 of them related) and they have no income. They said their parents forward them money roughly monthly to pay their rent. Their ~2 years of rental history so far is on a private room rental with the home owner who is moving away soon.

They told me if they apply via agents, they would get rejected quickly due to no income being full time students.

My apartment is managed by an agent, but I also personally show prospects to inspect in my own time.

So, I am wondering, what are your thoughts to renting to overseas student?

 

[grand dad]

Most rental managers lack the capacity to think out of the box. They would sooner put a welfare dependent tenant into your house than an overseas student.

I have always welcomed students. I would usually ask that they find a reputable guarantor who would co-sign the lease. Never had any problems when I did it this way. Nobody every skipped or left the place in a mess. In one instance, the university itself went guarantor on the lease. More often than not co-signees were usually members of the extended family or reputable friends.

 

[A Jeremy]

In one of our properties, we personally had a lease with tenants that were 18 and 19 year old Saudi engineering students who essentially had scholarships from their government. For proof of income they each had letters stating their names and that they would be receiving x amount of dollars until 2014 (this was in 2012).

They were really good tenants for a couple of years.

 

[Scott No Mates]

I have nothing against OS students in properties - currently have one with a married couple from the sub-continent both doing PHD's.

 

[Perp]

I own a 16-room student accommodation, and have had hundreds of tenants over the years, mostly overseas students. Overall, I find them pretty good tenants - most of them have families who've worked really hard to send them to Australia to study, and they are grateful for the opportunity and do little but study and maybe the part-time work they're allowed to do. Generally not party animals.

The primary "danger zone" is the couple of months immediately before they're due to depart the country. They don't care about getting listed on TICA, because they never plan to rent in Australia again, and once they've left Australia, you've got no hope of ever recovering anything. A not-insignificant portion of them have figured out the rules and will stop paying rent about 4 weeks prior to leaving, so that they eat up their bond and once you can do anything about it, they're gone.

I get my PM to be incredibly vigilant in the last month. We do an inspection about 3 weeks prior to departure, so that if there are any obvious necessary repairs due to tenant damage, we can highlight that to them at the time and ask them to fix it. If they stop paying rent, the day after their regular rent payment would normally be due, the PM gets in touch and reminds them that it's in breach of their lease conditions to chew up their last month from the bond.

Whilst there's little we can do if they don't choose to repair / continue paying rent, we find that most of them will if you just ask nicely. They've been lead to believe by others that it's just accepted practice to stop paying rent, and in particular, they think that getting their bond back is one less thing to worry about when leaving the country. When we point out that it's a violation of the lease, and could affect their future prospects of renting if they return to Australia, and how quickly they can get their bond back legitimately (and tell what we'll do to facilitate that), most are willing to fall into line. But we've built up goodwill by being good PM/landlord while they're there.

 

[Simon]

I've had no problems with OS students.

But I do get all sorts of people emailing my Gumtree ad claiming to be OS students wanting to scam me in one way or another.

The most common one is that they Send a cheque for more than the rent and bond. Then claim their scholarship people accidentally included their airfare on that cheque and could you immediately Western Union then enough so they can fly to Australia to start their course next week.

Then the cheque bounces and they are gone.

Pretty easy to spot. Language is not right and they sound very generalised. Last one I had was from an "American" girl who sounded Nigerian and included a stunning photo of herself. If I'm bored I string them along a bit and their replies give the game away again.

 

[eek]

My personal experience with overseas students from SE asia have been quite positive, especially around the Sunnybank area in Brisbane.

Despite appearing 'poor' and having no income, most of them have money forwarded to them from parents, and usually very careful with your property. Of course some of them don't have the greatest hygiene standards, but it's pretty hassle free and rent is always on time.

 

[Lil Skater]

If they can provide proof that money is regularly hitting their account an everything else checks out, there is no problem IMO.

I've rented to a number of OS students, haven't had any real issues, except every so often they won't report maintenance - which is important when it's something like water damage that progressively gets worse.

 

[kennyboi]

Most rental managers lack the capacity to think out of the box. They would sooner put a welfare dependent tenant into your house than an overseas student.

I have always welcomed students. I would usually ask that they find a reputable guarantor who would co-sign the lease. Never had any problems when I did it this way. Nobody every skipped or left the place in a mess. In one instance, the university itself went guarantor on the lease. More often than not co-signees were usually members of the extended family or reputable friends.

Thanks for the info. I am wondering if it is enforceable on the guarantor if the tenant left the debt behind. My PM told me it isn't legal or enforceable in NSW?

 

[rabidz]

My tenant is overseas students.
The truth is they always pay late and looks like they never maintain the house (for example the garden, they never mow it).

Really want to kick them out and the thing is they paid good money (well above average), and somehow I'm pretty sure that they always paid the rent (although it's always late)..

 

[Perp]

Thanks for the info. I am wondering if it is enforceable on the guarantor if the tenant left the debt behind. My PM told me it isn't legal or enforceable in NSW?

Your PM is correct. See s 120 of the Residential Tenancies Act 2010. The penalty is 20 penalty units, or $2,200.

Though the language in (2) leaves me unclear whether an indemnity would be acceptable.

Distinction: a guarantee says "if they don't pay, I will". An indemnity says "I will make sure you suffer no loss as a result of this agreement", or "between us, you'll be paid". But I am not a lawyer and I'd seek expert advice on that.

 

[PropertyProfits]

I advertised my apartment in inner west Sydney for rent recently on gumtree. One of the prospect is a group of 3 overseas student (2 of them related) and they have no income. They said their parents forward them money roughly monthly to pay their rent. Their ~2 years of rental history so far is on a private room rental with the home owner who is moving away soon.

They told me if they apply via agents, they would get rejected quickly due to no income being full time students.

My apartment is managed by an agent, but I also personally show prospects to inspect in my own time.

So, I am wondering, what are your thoughts to renting to overseas student?

Students have been my second best clients when it comes to renting properties for my landlords. The first are proffessional immigrants without current jobs in Austraia. By the way, I was an immigrant once upon a time as well.

There are only 2 things that one needs to safeguard with your investment property.

1. Your Rent (your money)
2. Your Property (no damage) - if you structure #1 correctly, you will rarely have a problem with #2.

They told me if they apply via agents, they would get rejected quickly due to no income being full time students.

This is how I would close the deal for my landlord.

Call them up and tell them that you would do the deal if rent is paid 3 months in advance. If they are studying a Bachelors or Masters at a top university, I would ask if they could pay an advance and not mention 3 months. They might even opt to pay 6 months - why ask for 3 months then...but aim for 3-6 months.

Students from good families will be able to pay this - you will know this from the courses they are doing and at which universities. Used to sell Aussie universities and did their visa application...so knew how much their parents were earning and also what their savings were

Ensure the rent is paid in advance. Mostly you would not have to worry about your property being damaged if they can come up with this money.

Hope this helps.

 

[Perp]

Call them up and tell them that you would do the deal if rent is paid 3 months in advance.

Except it's illegal in NSW, and I imagine every other state, too.

 

[Blueberry]

Call them up and tell them that you would do the deal if rent is paid 3 months in advance. If they are studying a Bachelors or Masters at a top university, I would ask if they could pay an advance and not mention 3 months. They might even opt to pay 6 months - why ask for 3 months then...but aim for 3-6 months.

.

A quick google indicates you can't ask for that much upfront in at least nsw and VIC. Check first.

Edit: Seems I was beaten to it - and by a lot. I could swear it doesn't take me that long to type. Lol

 

[PropertyProfits]

Except it's illegal in NSW, and I imagine every other state, too.

It's not illegal when both parties agree.

And if it does become illegal tomorrow after they read this post, offer the option verbally and get them to send you an email stating that it is their choice.

 

[Perp]

It's not illegal when both parties agree.

And if it does become illegal tomorrow after they read this post, offer the option verbally and get them to send you an email stating that it is their choice.

That doesn't make it legal; you're just trying to prevent getting caught. Makes me sick.

 

[PropertyProfits]

A quick google indicates you can't ask for that much upfront in at least nsw and VIC. Check first.

Nobody is asking. It is a suggestion - the students are offerring.

This is related to Sydney and does not apply to Melbourne.

 

[PropertyProfits]

That doesn't make it legal; you're just trying to prevent getting caught. Makes me sick.

It should not make you sick.

Students are being helped - while building up a good credit history so that the next agent recognises them as better tenants (in most cases) than the ones who have an income.

If there is anybody who is sick are the agents who are not willing to help them because they do not have an income.

 

[Blueberry]

Nobody is asking. It is a suggestion - the students are offerring.

This is related to Sydney and does not apply to Melbourne.

I imagine they would be within their rights to ask for the extra cash back once they are in the property anyway.

And if anything goes to tribunal, you have a mark against you and a whack over the knuckles

 

[PropertyProfits]

That doesn't make it legal; you're just trying to prevent getting caught. Makes me sick.

Hey Perp,

There is a side to this that you do not know.

This money is not the student's. It comes from the parents.

The good students would not hesitate to pay advance rent - why because they know that they would have to pay it today or in 6 months times.

The bad students would get their parents to send 12 months rent, buy a luxury car and have the landlord/agent begging for their rent only to see a beautifully polished car in the garage. Believe me it is a disgusting feeling for the landlord/agent.

Now put yourself in the students place. With all these retarded agents who have possibly been offerred rent in advance anyways, have left these students frustrated anyways. All they are looking for is somebody to say, okay guys I am going to take a risk with you guys but this is how I am going to minimise my risk. Would you not take this offer and build a credit history for yourself so that the next time you come across a retarded agent, you could provide a spotless tenant ledger.

I hope you feel better reading this.