As students rush to finalize living arrangements for the next academic year, renter frugality and new trends in campus living are forcing some realty companies to alter their market strategies.
Mark Patmore, owner of Mercia Residential Properties, said students are trying to find ways to reduce individual costs much more than in the past.
Know before you sign a lease:
- Check for dangerous conditions that by law must be fixed by the landlord, such as a leaky roof or dysfunctional toilet.
- Pay close attention to the inspection sheet and document any damages.
- Know what negligence means and how it is defined in the lease.
- The landlord has no right to enter your apartment unless agreed to in the lease.
- The security deposit is yours and should only be withheld for specific reasons.
Source: Dorothy Bernholz, student legal services
“I have had to work much harder than in previous years,” Patmore said. “Students are sharing more. That two-bedroom house now has three people in it to help each person cut back on rents a little.”
In a University town apartments are designed to meet students’ needs — and these needs often lead to higher rents, said Adam Brown, treasurer of the Greater Chapel Hill Association of Realtors and property manager of Louise Beck Properties.
“When you have people sharing the costs of the assets, such as roommates, landlords can charge more in aggregate for a student property,” he said.
Deciding what to charge
Brown said the college real estate market allows landlords to have broader discretion when determining the cost of rent.
“In a college town, you have a different and almost mutually exclusive market from a non-student area,” he said. “The product is different, and once the demand is there you also see that product is priced differently.”
Town House Apartments and The Warehouse both have rent increases budgeted for next year.
Gina Turner, Town House property manager, said the anticipated 10 to 20 percent increase is due to improved amenities, which previous rates didn’t reflect.
“Rent includes high-speed internet and full cable, so these rates are taken into account,” Turner said.
Other complexes in the area are holding rates steady in an effort to draw in residents who may be wary of renting after the recent economic downturn.
Adam Jones, owner and general manager of Mill House Properties, said rates for most of his units will not increase next year.
“The rental market now is a bit soft, meaning there is a lot on the market,” Jones said. “It’s a combination of the economy and more students staying on campus, allowing for some of our regular student rentals to be vacant.”
Jones said many properties are offering incentives for prospective tenants to sign earlier because of financial conditions and the higher vacancy rate.
About 8,584 students are living on campus this semester, compared to 8,420 last fall.
“I have noticed several offers for students to sign leases early, such as a few hundred dollars off of rent or a gift certificate,” Jones said. “People are looking for lower rents, and they are definitely trying to negotiate a bit harder or looking for a special to save money.”
Mill House required current tenants to indicate whether they would renew their leases by Nov. 10. Jones said incoming residents started signing leases for next year as early as September.
Jones said competition is also steep for students looking for the ideal location near campus.
“In terms of places right downtown that are student-appropriate, those are the ones that are in such high demand,” Jones said. “Demand often starts a year in advance.”
Patmore said that while owners factor in property tax rates, which are lower now than in years previous, there is no correlation between the rate and the price of rent because demand is still high.
And, Jones said, students should be cautious when looking for cheaper properties.
“The old adage that you get what you pay for still rings true,” he said. “Be careful in terms of getting such a great deal that you will be in a hobble when it comes to maintenance and quality.”
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