It’s no unusual for parents to buy a home for their child to live in when they enter college. Many see it as a better investment than paying rent for four years. But being a landlord is not for everyone.
You must ensure to buy a home close to the campus, consider your tenant’s parking needs, laundry facilities and internet access. Blair and I are familiar with investment properties and can make you aware of the electrical safety standards and bylaws.
It is advisable to purchase the home in your own name and not that of a company. This ensures you will be protected if there is a dispute and one roommate needs to be removed from the home without going through a formal eviction.
All roommates should sign a written tenancy agreement. Have a separate agreement for each student, that doesn’t specify a fixed term, and indicates that the roommates will share living accommodations, including the bathroom and kitchen facilities with the owner or with a child of the owner.
Because the kitchen and baths are shared with the owner’s child, the termination provisions of the Residential Tenancies Act (RTA) do not apply. This exemption means roommates could find themselves out on the street with little or no notice. It works to the benefit of the owner and to the detriment of the prospective roommate.
They need to know, coming in, that if there is a breach of the agreement they can be tossed out with basically no notice. You should outline the consequences in the tenancy agreement along with the time lines involved.
It is prudent for the owner to request a guarantor in case a roommate defaulted on the rent and because the RTA doesn’t apply here, you can also ask for a security deposit.
All roommates should sign a roommate agreement that outlines house rules and roommates’ responsibilities, as well as rules that concern guest, laundry, smoking and pets. Usually the child of the owner takes care of the house. Putting rules down on paper sets some of the guidelines of how people are going to live together. This way the roommates don’t think they are paying the owner’s child to do all the work!
If you have more questions about buying a college dorm, call or email me. I’d love to answer of your questions.
Tags: bowmanville real estate, home buying, house buying, how to buy a house, investment property, oshawa real estate
November 26th, 2009 at 6:58 pm
There should also be a reminder that if the home is part of a condominium, there may be regulations that the occupants must abide by. This could also include enforcement of any Regional occupancy by-law restrictions. There are Condominium communities that looking to enforce occupancy provisions to prevent commercial “rooming houses” from popping up. This does not mean you should avoid Condominiums, just do your homework for a student friendly community…
Tracey McLellan
http://www.traway.com
November 29th, 2009 at 12:57 pm
Another important consideration is the location of the purchase. If the home is in a condominium community, then the purchaser must make themselves familiar with the corporations documentation before the purchase. Some condominums (especially those close to UOIT) are beginning to enforce occupancy by-laws as a deterent to the “rooming house” style of occupancy. While this may not apply to purchasing an investment unit for your child to attend university, a little homework first will save much grief in the end.
Tracey McLellan – http://www.traway.com
November 29th, 2009 at 1:04 pm
Another consideration is the location of the dorm. If it is in a condominium community, careful consideration should be given to the governing documents of the dorm.
Some condominiums (especially those close to UOIT have begun to examine occupancy by-laws and restrictions in their declarations as a means to avoid the “rooming-house” type of occupancy.
While this may not apply to a purchaser looking for an investment while their child attends university, if the home is to be occupied by several students, it may be tarnished with the same brush.
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