Ever watch that show on HGTV about the guy who helps first-time landlords choose /fix up properties? Scott McG-something. He says that his first rental properties were student rentals, and they're his favorites -- they're the most profitable, and if the students don't pay, he can turn to their parental co-signers. It's a good business, if you have the right skill set and are interested in being a landlord.
My college daughter is looking for an apartment next year, and most of the apartment complexes use this same method you describe: 4 bedroom apartment, 4 girls sign 4 individual leases . . . so my daughter might actually be leasing Bedroom A, while her friend is leasing Bedroom B. If you look at what each girl's paying x 4, it is just over 2K/month.
However, we've decided to do it for several reasons: When we compare her total apartment rent to her total dorm rent, it's about $800/year more. This is to get her a private bedroom, access to a kitchen and living room, a bathroom shared with only one other girl, and a guaranteed parking space near her unit. The unit comes with basic furniture and a washer/dryer. These things will cost more than the dorm, but as a junior, she's ready for a little more privacy and space, and it's still a decent price.
I do like the idea that if one girl drops out, gets sick and needs to go home, or whatever, my girl isn't on the hook for a portion of that girl's rent. The apartment complex IS allowed to insert a new random roommate (must be female, must be non-smoking) into the room, but that's no a whole lot different from the dorms.
I had a problem once with a roommate in college, and it was very stressful for me: The didn't much see the point in paying bills on time, and she would say she was fine with paying a late fee -- I wasn't.
And a friend of mine's son is going through a problem right now: A couple guys are sharing an apartment, and they were all giving their rent money to one of the roommates . . . who was putting it in his pocket. He also made a point to get the mail every day, and he hid the notices from the apartment complex. The guys -- being typical college guys -- didn't realize anything was wrong 'til they got the eviction notice. My friend and the other parent "paid up" to prevent their sons from being out on the streets, and they're taking the other kid to court. What a hassle.