Landlords reeling as Grinnell College housing policy cuts tenants and income

Steve Menninga and his son, Dave Menninga, rented eight properties to Grinnell College students last year.

But after the school tightened its off-campus housing policies, the two said they couldn’t find enough tenants this year and were forced to put three houses on the market.

Steve Menninga said he only found out about the policy change through prospective and current tenants, not having received communication from Grinnell College itself.

“The students had contacted us saying, ‘Hey I want to live off campus, but I need to check first,’ and then calling back and saying, ‘Hey, you know what, they’ve kind of changed a little bit, I guess I’m not gonna be able to live off campus,’” he said.

In the past, the two were able to house 37 student tenants, but this year they are down to 26. Of the three houses in the market, the Menningas already sold one. They said they’re also converting two other properties into AirBNBs to market to parents of Grinnell College students.

“Dave and I’s market has always been college students,” Steve Menninga said.

The student housing landscape shift came in fall 2024, when the College announced only fourth-year students would be permitted to live off campus starting in the 2025-26 academic year.

Penny Gable, a realtor at TurnKey Realty and property manager for many off-campus student residences, said that even a small drop in students living off campus is still critical, as it frees up a lot of houses.

The properties, initially advertised as investments to landlords, she said, are fairly large houses near campus — making them perfect for groups of college students willing to pay above market rate.

“College kids, they want that poor college kid living experience,” Gable said. “They don’t care if it’s painted pretty or [has] new carpet or anything like that, but townies expect a little more.”

Gable manages a property for a client who she said was blindsided by the college’s decision.

“I had one owner who’s from out of town and he didn’t really know anything about the college kids not coming off campus and if he doesn’t get his units full, he will lose $85,000 this year in rent,” she said.

“I get where the college is coming from,” Gable said. “I get that they’ve redone dorms and they built dorms and now you guys can be there–self-sufficient. I get it but the community who’s been there, supported [them] for so many years, and now it’s like what do they do?”

Mattia Wells, director of strategic communications and media relations, wrote in an email to The S&B that “Due to the pandemic, residence hall renovations and the timeline for new construction, Grinnell College has had fewer students in campus housing over the past several years, so we’re excited to welcome more students back into residence hall communities.”

Wells said the College welcomes ongoing dialogue with landlords and community members.

“The Office of Community Partnerships, Planning and Research serves as a collaborative thought partner between the College and the community, and community members are encouraged to connect with the office,” she said.

Local realtors, Kevin Kolbe of Broker & Owner of Ramsey-Weeks Real Estate, Penny Gable of TurnKey Realty and Joyce Halblom of TurnKey Realty, all reported a 25 to 30 percent decrease in rent for college student rentals. They said this price drop could not only impact landlord incomes, but also decrease the property values.

“Now the value I put on the market is going to be less because a lot of people buy rental property based on the income,” Halblom said. “I have a guy that bought a house a couple years ago with the intent of making it a college rental and now he’s very upset because he can’t get his rental for hardly anything.”

Evan Petig `98 owns property on High Street that he rents to college students.

“I always enjoy the college students,” Petig said. “We put money into it and probably things are gonna get a little beat up, but for that, you get above market rents and you get some good kids.”

Petig typically signs leases with students in October or November, a year before his tenants will be living off campus. This year, he has been more cautious about signing the lease agreements.

“I’ve got some groups saying ‘Yes, I’ll sign a lease’ and some groups saying ‘I’d really like to live there, but I’m concerned that I will sign a lease and then I’m not going to be able to get off campus.’ So you know what, the process has definitely changed,” Petig said. “It’s causing a lot of uncertainty.”

In the meantime, Petig is in the process of fixing up one of his properties to market as a single-family home.

When asked about whether or not the college rental situation has any impact on the larger housing market, Kevin Kolb, real estate broker, said that this is part of the constant ebb and flow of the housing market.

Gable added that this is a particular niche that affects some owners, but does not have much of an impact on the larger Grinnell housing market. Halblom, however, noted that fewer students living off campus does affect the community.

“We already have a college that provides every amenity these kids need,” Halblom said. “Now I feel like we’re gonna see less college students just around town. And that’s sad because we are a college town. I feel that … we’re just gonna isolate the college students more and more to be dependable on the College.”

As the season to sign leases comes, landlords hope Grinnell College changes their decision.

“We’re going to sell what we can and diversify and hang on,” Menninga said. “Hopefully the College will come back and say, ‘Hey, you know what, this is a part of the overall experience of a college education.’”