First as you obviously are I would give them time to process and figure things out. This is a really complicated situation requiring a LOT of sensitivity.
Since you have the last months rent and security and the year is nearly over it is probably easiest on everyone to leave the place vacant with just the one tenant until the end of the term - unless the families object over the cost.
However while you need to be respectful and reach an equitable solution, you should not have to take an additional hit financially.
It's kind of hard though because technically your "job" is to rerent the property to mitigate the costs. I think if you can find a way to be sensitive and yet explain this to the parties then let them decide what they want.
You DO NOT want to get into the position of being the greedy insensitive landlord.
Also you have the sad issue now that nobody is going to want to immediately move into a deal persons room (to be somewhat brusk).
I would say probably the remaining tenant will want to leave the memories. You may be vacant over the summer, then get a whole new set of tenants who did knot know the deceased - sort of a clean slate start.
Give the family space, both time and physically when they come to collect the students belongings. Or if the case is such you may want to offer to pack the belonging up for them.
You just really need to play this by ear and it probably wouldn't hurt to try to get some guidance from the school medical/psych/counseling staff to help you in dealing with the families.