What makes a state landlord-friendly?
Landlord-friendly states have laws, practices, or lower operating costs that benefit the interests of landlords
. This does not mean that tenants are mistreated in these states. Rather, landlords have broader authority to properly manage their rentals
Identifying a state as landlord-friendly is somewhat subjective, as landlords have different opinions about what is most important and helpful to them. Also, due to municipal laws, different cities within the same state can vary widely when it comes to landlord-friendliness.
In this article, we are considering a state as landlord-friendly if it has any of the following characteristics:
Low property taxes
Owning real estate comes with costs—including property taxes. In 2020, the average property tax rate was 1.1%
in the United States. If a state's average rate is below the national average, landlords may be more inclined to invest there.
No rent control
Rent control is legislation that regulates how and when landlords can increase rent
. Many states ban rent control
while others allow municipal governments to pass their own legislation. Oregon
is the only state that has passed a statewide rent control law. If a state is landlord-friendly, it will not institute rent control.
Fast eviction process
A state's eviction laws usually outline the lease violations that constitute an eviction and the length of notice
landlords must provide. When a state has laws that enable landlords to rightfully evict tenants in a simple and timely matter, its residents may be more inclined to invest in rental properties.
No deposit limits
limit the amount that landlords can collect for security deposits. In addition, some states give landlords less time to return security deposits. When landlords do not have adequate time to properly inspect their properties before returning security deposits, they could miss tenant-caused damage and suffer financially.
Short notice requirements
Landlords have to enter their rental properties from time to time, whether it be for an inspection
. A state's rules regarding the right to enter a rental property can affect a landlord's ability to protect their property. A state with shorter notice requirements can make it easier for a landlord to efficiently manage their properties, thus making the state more landlord-friendly.
Expanded tenant rights
Some state laws grant tenants additional rights that diminish a landlord's full authority. In some states, such as California
, when a landlord is not repairing something in a timely fashion, tenants have the right to make repairs themselves and deduct the cost from their rent. Therefore, the extent of a tenant's rights
can affect the landlord's rights.