by Dixie Decker
Dixie Decker will be a featured speaker at the Michigan Landlord & Real Estate Investor Conference & Expo this year, February 27-29, 2020 in Grand Rapids, Michigan. Dixie's presentation will be Friday, February 28th at 10:10 a.m. Tickets are only $9.99 for all three days for non-members and free for current RPOA members. Click here to get your tickets now!
I used creative buying of student housing to literally go from bankrupt to millionaire in 3 years. I have a LOT of tips and strategies for buying, managing, and maintaining student houses.
Curious about how I don’t have vacancies, evictions, or damages with college kids as students? Buckle up as I am going to share with you the biggest secrets in how I keep my properties filled with no major damages or non-payment worries.
Would you believe it if I told you it starts with marketing and predicting your market? Oh yes it does!
It doesn’t matter to me whether it’s an open house for a property on the retail market, rent to own, or student housing. I would suggest listening up and use this twist that I have successfully used for years for the student housing niche with single family houses, NOT all those big apartments you think I am talking about.
Here is how it works, we throw a sign in the yard that says PRE-LEASING, in October of the prior year saying we want to PRE-LEASE it. The key is the words pre-leasing not “For RENT” which implies available now. The minute a property is acquired/or lease not being renewed, we also place the sign in the yard, and this is also the fastest way to get the current tenants to agree to renew for another 12 months because they are scared they will lose it and don’t want to hassle with you showing it. Congrats, this is the easiest way to turn a 12 month lease into 24 without any work or money spent on marketing. We post free ads with the per room rate & must fill whole unit, on Facebook, Zillow ad manager, Craigslist daily (most of the time twice a day), hang flyers all over campus (which we pay a college student to hang for us), coffee shops, bars and restaurants in the area of the subject property.
The other key here is to market your best properties on this material even if they are already pre-leased, your goal is to get as many calls coming in as possible and then flip them to what you still have open, “bait marketing,” as long as they are similar products, this works well. I even have a script for my assistant and Virtual Assistants to handle these calls.
You see in October of any year, I am already filling my houses for the upcoming June until the following years June, that’s 18+ months in advance. Would you sleep better if you knew in October you were full for the next two years on every property you owned? We pick one day and time to show the property. THIS IS NOT AN OPEN HOUSE, and if you treat it that way you lose!
Here is how we make secret #1 happen:
Our VA takes all the incoming calls and has very basic questions for the potential tenants:
What’s your name, phone, email address?
What’s the most you can pay per month?
How many potential roommates do you have? What month is ideal for you to move in?
If it’s a match for the property or a close match (because they always have more money that they tell you), the VA says “we have only one appointment left on Saturday at 1pm, would you like to book that? We are sure it will go that day and won’t be available after that, so I also suggest you have applications and deposits ready, because the first group to deliver all applications and full deposit, gets considered first for approval.”
We then let them know “we will be texting you that day to confirm your appointment & if you don’t message back to confirm we won’t show up to show it to you, ok?” VA adds to the Gmail calendar the name and number of prospects and then the day of the appointment the VA texts every group to confirm their appointment.
When we head to the appointment we take application packets with us (even though we now have this online to access) because if they look and you hand them a packet they will do one of few things.
We already filled them out online and here is our security deposit for the whole group. No we don’t need them (meaning they don’t want the property) and we ask what would you like to see different for a property? They take them, meaning they are interested—rarely they take if they don’t want the house. Note their name to follow up. Multiple groups call parents at the same time to see who can get you money the fastest.
Now there are several potential full groups of tenants waiting for a house just like the one they were shown, and being in the position I am now, I just take them to my next property and show that property to them, and boom that property is now pre-leased as well.
Doesn’t that sound nice? I have no evictions, but how you ask? Let me explain.
In “normal landlord life”, you come across the following scenario. It’s Christmas and your tenant loses their job, the car breaks down, or something medical comes up…who isn’t getting paid that month…THE LANDLORD! And let’s face it, I don’t have the heart for that! You have all heard of stories like these happening.
So, my method is simple to ensure secret #2 can happen for you:
I have all the roommates on one lease and the parents co-sign on that same lease, for the entire amount of rent for the house not just their single room portion.
What does this really mean…MULTIPLE GUARANTORS with multiple jobs to pay the bills, prevent damages or pay for them, and multiple credit scores on the line. Who wants to come out of college or wants their child to come out of college after spending tens of thousands of dollars with damaged credit preventing them from getting their dream job?
Lastly, damages. Aren’t they animals?
Not at the rates I charge for my drop dead gorgeous houses! I mean when was the last time toilet handles just fell off in your house, a door just came off the hinges, or drywall damaged itself? Never, and yes, I tell them that. My lease specifically states that if this happens while a certain group of tenants are in the property, they have to fix it, not me!
Plus, who do you think pays the security deposit and wants it back? MOM & DAD, so yes you guessed it, that’s who makes sure my houses come back to me the way I gave it to them and then I happily return their full security deposit @ $500-$600 a room/person.