Summary: When it comes to choosing your real estate investment property location, landlord-friendly states offer better benefits for investors. Today we’re sharing the 5 reasons to invest in landlord-friendly states, and the 5 best states to start!
We talk a lot about HOW to invest here in the Kitti Kingdom. And for good reason…we want to share the joys of real estate investing, passive income, and financial freedom with everyone!
When you decide it’s time to start your real estate investing journey, however, it can be tricky to figure out exactly WHERE to focus your attention. So, today we’re sharing all about landlord-friendly states – why they’re great for investors, and our top picks for investors in 2023. ✨
The truth is, that with due diligence and research, you can find great real estate markets in almost every state. Butttt by focusing on landlord-friendly states, you can save yourself some time, and get right into the action.
And taking action is totally key to any investment success.
Just picking a random spot on the 🗺️ map for where you want to invest your money is also not the best approach.
Consider this a simple guide for narrowing down your search, and pointing you in the right direction. You may have other personal criteria for where you want to invest, but we’ll give you the deets on why landlord friendliness should be added to the list.
Ready to dive in? ⏬
Here’s what you’ll learn:
- What is a landlord friendly state anyways?
- Why landlord friendly states make for great real estate investments
- Top landlord friendly states for 2023
What is a landlord-friendly state anyways?
When we talk about states being landlord friendly, we don’t mean to say that landlords are loved while tenants are treated poorly.
Juuuust want to make that clear.
👉 A state that is landlord friendly simply has laws and regulations in place to give landlords support and authority to oversee their properties in a favorable way. That could have to do with the different costs of things like owning a rental property, how to set rent, or how to deal with unruly tenants.
Now, different people have different ideas of what is favorable, so we’re talking about something fairly subjective. But there are some key characteristics to look for that can identify a landlord-friendly state.
We’ve narrowed it down to these 5 things that make a state landlord friendly, and ideal for real estate investment properties:
✔️ Low property taxes
Costs of owning properties can vary from state to state. High property taxes can be a real bummer if they aren’t taken into account. That’s why a state that offers lower-than-average property tax rates is pretty appealing for investors and landlords alike. Being able to decrease costs is a way to set yourself up to make more through your real estate investment.
✔️ No forced rent control
Some states have mandates in place that force rent control onto landlords, making it hard to increase rent when necessary. And listen, we get that landlords shouldn’t be able to go crazy with price increases that aren’t warranted. But there are definitely times when increasing rent is the only way to keep up with inflation and rising utility costs.
✔️ Control over the eviction process
Every once in a while, it does happen – landlords get a bad tenant. In some states, landlords don’t get much control over dealing with these bad tenants, making them nearly impossible to evict. Being stuck with someone who doesn’t pay rent, destroys property, or breaks a lease agreement can be a huge time, energy, and financial strain. States that allow landlords to swiftly evict when absolutely necessary can offer peace of mind to landlords and investors.
✔️ No limits on deposits
When it comes to security deposits, it’s nice to have the ability for landlords to take their time and set their own limits – within reason, of course. Some states dictate how fast security deposits must be returned to tenants, making it hard to catch damage or issues to the property. States that put less pressure to return deposits immediately allow landlords to fully inspect their property and decrease the financial risk of missing things.
✔️ Balanced tenant and landlord rights
Relationships need balance to function properly, and tenant/landlord relationships are no different. Some states offer much more freedom and favor to tenants than landlords, making it very hard for landlords to create any financial security. That’s why states that provide more balance for both tenant and landlord rights are more financially desirable for landlords and investors.
Landlord-friendly states are really great places for both landlords and tenants. When tenants are happy, they stay longer, treat properties better, and help keep the rent coming in for a long time.
So, we’re talking about a win-win situation, here. ❤️😍
Why landlord-friendly states make for great real estate investments
Okay, you can probably see why landlord-friendly states are financially better options for landlords to own properties.
Buttt what about passive investors?
Let’s say you want to be a passive investor, and don’t actually want to take part in the day-to-day actions of managing a property. In that case, does it STILL matter if you invest in a landlord-friendly state or not? 🤔🤔
The short answer is yes
Landlord-friendly states provide more financial stability for all types of real estate investors.
You’re investing money into a property, so your returns are tied to the cash flow 💰 of the property.
You might not be dealing with things like bad tenants or rent control personally, but your potential returns are still affected by them. Investing in landlord-friendly states gives your investment properties a higher chance of producing cash flow to keep your passive income streams pouring in.
The best, landlord-friendly investment states of 2023
To take this guide a step further, we’ve compiled a list of our 5 fave states for investing this year.
Remember, this is not an exhaustive list and doesn’t mean these are the ONLY places to invest. It’s just a nice starting point for real estate investors, to go along with your research and goals. 🙌
1️⃣ Texas
Texas takes lease violations very seriously, which is one of the reasons it’s a true friend to landlords and investors. Being able to evict bad tenants or receive financial relief for broken leases helps keep investments on the safe side.
That’s enough to make Texas a fine place for investment properties, but there’s more. Texas also offers lots of favorable real estate markets with rising demand and low purchase options.
2️⃣ Georgia
Georgia’s average property tax rate is lower than the national average rate, which makes it a great place to own real estate assets. Landlords also have support for legally pursuing broken lease agreements.
With low property taxes, control over lease agreements, and no limit on security deposits, Georgia really is a PEACH for landlords and investors alike. 😉😉
3️⃣ Arizona
Arizona is also in the low property tax club, alongside Georgia. This state also has no forced rent control, making it a great rental property location. Arizona supports a fast eviction process when legally warranted, like for lease violations or illegal actions committed.
4️⃣ Florida
Florida’s rental property strengths lie in its favorable rules towards fast evictions, and freedom to set security deposits and lease agreements. Rent control is not allowed, and landlords can take up to 60 days to return security deposits.
5️⃣ Alabama
The last on our list is Alabama, which offers a nice mix of the most landlord-friendly perks we’ve discussed today. With extremely low property tax rates, quick eviction processes, freedom in setting rent, and no laws against raising rent, Alabama earned its place on the list. It’s definitely a sweet spot for owning and investing in rental properties.
The Big Picture
There you have it! 😉😉
Remember, these states are not the only places you can invest, buuuut we had to share our current fave places for investors to reap those landlord-friendly perks. 👌
If you’re looking for more help in navigating your investment journey, we are SO here for you. In fact, we’ve got tons of tips, resources, guidance, and community just waaaaiting for you to take the next step toward financial freedom! ➡️ Join the Kitti Freedom Club today.
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