Do I Have to Rent to Students?

by Chris on October 18, 2010

Q.  Can you comment in your newsletter about the legality of rejecting students as tenants?  D.W.

The answer may depend on where your rental properties are located. 

Students – people enrolled in higher education courses, generally are not protected by discrimination laws.  However, a handful of local housing authorities have rules specifically prohibiting landlords from maintaining a “no-students” policy.  For instance, in Austin, Texas landlords cannot reject  rental applicants solely on the basis of their “status as students.”

College towns that have housing shortages are far more likely to pass these rules, possibly after receiving some pressure from the college itself.  If so, there may be a student housing board that can work with applicants to make them understand their legal obligations under a rental lease.

Even if a “no-students” policy is legal in your area, you may be hurting yourself by discounting all student renters. If the student also is a parent, disabled, or a member of any other protected class,  you cannot discriminate.

Discrimination could include requiring a higher deposit, charging higher rent, or refusing to rent altogether.

Is it really the status of “student” that is the problem, or something else – for instance, concern the applicant may behave irresponsibly?  Many landlords fear that a student can’t make the rent payments, may have noisy social gatherings, or violate occupancy standards. 

Careful tenant screening can eliminate many concerns about a student applicant’s behavior.  For instance, be certain to check for prior eviction history and run a criminal background check.  Don’t think that the possibility of a thin credit history justifies not running a tenant credit report.  The credit report will still provide clues regarding whether the information on the rental application is complete and accurate.  Besides, if a landlord is ever investigated for discrimination of any kind, it is imperative to prove that every applicant is treated the same during the application process, including tenant background checks

A previous landlord reference is a critical tool for determining the likelihood that the student applicant is appropriate for your rental property. 

Where income is a problem, you can consider asking for a lease guarantee from a family member or other source.  If you are willing to accept an applicant with a co-signer, be certain to offer this option to other tenants in similar situations to avoid allegations of discrimination.

If there is a perception that you are going to discriminate against students, be careful to verify the facts the applicant gives you — they may feel more pressure to hide facts to avoid being rejected.

Also, be certain the student applicant is not a minor.  Typically, a person must be at least 18 years old to be legally accountable on a contract like a lease agreement.

This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

Click Here to Receive Landlord Credit Reports. 

Disclaimer: The information provided in this post in not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

{ 1 comment… read it below or add one }

Jackson Pollack October 20, 2010 at 9:42 am

I rent in a college town and discriminating against students is foolish. Students often are spending there parents money so they will pay more than market and not shop around. They don’t expect the place to be fancy or have as many amenities, just clean and functional.

If you are more than walking distance from the school and don’t have more than a two bedroom then you will probably not have a “party house” issue and if it is that close or has a lot of bedrooms than you should have know what you were getting into.

Treat them with respect, don’t talk down to them and be very prompt (within a few hours at most, they are used to immediate) with returning phone calls and emails. You often don’t have to do anything, just let them voice there complaint/problem and say you are sorry and you will see what you can do and often times you won’t be able fix there problem. They will normally be understanding that you can’t always help. And THANK them for calling you and bringing the problem to your attention even if you can’t do anything about it. If you don’t thank them they will never call you about any other problems and they don’t get what a big problem verse a small problem is.

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